“Soda taxes work”: US city of Berkeley sees 50 percent drop in sugary drinks consumption

27 Feb 2019 --- The US city of Berkley saw a 52 percent drop in the consumption of sugary drinks after it levied the nation’s first soda tax on sugar-sweetened beverages, effective since November 2014. This is according to a study from the University of Berkeley published in the American Journal of Public Health. The research highlights the importance of policy implementation as a means to promote healthier drinking habits and reducing sugar-related diseases such as diabetes, cardiovascular disease and metabolic syndrome.

Three years after the tax was implemented, the city’s low-income neighborhoods have reported drinking more than half the number of sugary beverages compared to before, while water consumption went up by 29 percent.

The study, led by Kristine Madsen, Faculty Director of the Berkeley Food Institute in UC Berkeley's School of Public Health, is the first to document the long-term impact of soda taxes on drinking habits in the US.

“This just drives home the message that soda taxes work,” notes Madsen. “Importantly, our evidence comes from low-income and diverse neighborhoods, which have the highest burden of diabetes and cardiovascular disease, not to mention a higher prevalence of advertising promoting unhealthy diets.”

The study has come at a time where the opinion on soda taxes is split. Philadelphia and Seattle alike have soda taxes “on the books,” yet Washington and California passed bills in 2018 that banned municipalities from putting future soda taxes in place.

“Sugar-sweetened beverages, which are linked to obesity, diabetes and cardiovascular disease, cost our nation billions of dollars each year, but they are super-cheap. They’d cost much more if the healthcare costs were actually included in the price of the soda,” Madsen says. “Taxes are one way of taking those costs into account.”

Madsen and her team have been monitoring the drinking habits of low-income and diverse areas since 2014 when a majority 76 percent voted in favor of taxing all sugary beverages. While the excise tax is levied on distributors, rather than directly on consumers, subsequent studies have shown that retailers incorporated the higher costs into the shelf price of the drinks.

The researchers surveyed roughly 2,500 people annually on their drinking habits across the Berkeley, Oakland and San Francisco areas. The surveys revealed a steep decline in sugar-sweetened beverage consumption in Berkeley between 2014 and 2017. The decrease was seen overall for sugary drinks, and specifically for soft drinks like Coke and Pepsi, sports drinks like Gatorade and Powerade and sweetened teas and coffees.

Oakland and San Francisco, however, consumed the same amounts in 2017 as in 2014. This suggests that the changes were unique to Berkeley and the soda tax is not because of a possible regional trend. Oakland and San Francisco have since enacted their own soda taxes, which went into effect in mid-2017 and 2018, respectively.

Madsen warns, however, that the survey also provided limitations. “Street intercept surveys do not provide a random sample of residents and Berkeley is a relatively small and highly-educated city.”

The increased price may not be the sole reason behind the shift, she says. Taxes also send a message about societal values, that can greatly impact consumer behaviors.

“There are some earlier studies out of Berkeley that suggest that the messaging alone is effective at reducing consumption,” Madsen adds. “But people are still very much affected by what hits their pocketbooks.”

The largest part of the revenue from the soda taxes goes towards supporting the city’s nutrition education and in-school gardening programs, as well as to local organizations working to encourage healthier behaviors in the community.

Previously, Mexico also increased taxes on sugary drinks and saw positive changes, providing further evidence that policy can work effectively in reinforcing healthy habits.

“I really want to push back against this idea that taxes are the sign of a nanny state,” Madsen states.

“They are one of many ways to make really clear what we value as a country. We want to end this epidemic of diabetes and obesity and taxes are a form of counter-messaging, to balance corporate advertising. We need consistent messaging and interventions that make healthier foods desirable, accessible and affordable,” she concludes.

The pushback against sugar
The adverse effects of high sugar consumption are increasingly becoming a concern for consumers and governments alike. In the sugary drinks space, a position paper, published last May in Obesity Review, finds scientists agreeing that sugar-sweetened beverages play a unique role in chronic health problems, elevating their calorie status to more harmful than calories from other foods and drinks.

On the other side of the pond, the UK enacted a sugar tax on beverages in April 2018, which followed its food and beverage sugar-reduction plan from 2016. The moves are part of the nation’s a bid to reduce the negative effects of increased sugar consumption. The latter challenged all sectors of the food industry – including retailers, manufacturers, restaurants, cafés and pub chains – to reduce by 20 percent the level of sugar in food formulations by 2020. Industry was also challenged to achieve a 5 percent reduction in the first year of the program which was not successful.

According to a new report, however, the imminent Brexit may create an opportunity to act further on sugar reduction. The report claims that the key to achieving a two-thirds cut in consumption is by producing less sugar and making it more expensive. In a direct challenge to industry. It states that reductions on this scale will not be achieved by edicts to reduce the amount people eat, but by new agriculture and trade policies that cut sugar supply as well as demand, including decreasing UK-grown sugar as well as slashing import volumes.

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