One year ago, a new and never before seen tax was introduced in Berkeley, California. The tax targets sugary soft drinks by adding an extra 10% to the pre-tax price, also measured as one extra penny for every fluid ounce. The average can of cola is 12 cents more expensive, while the price of a two litre bottle has increased by 68 cents. It is well known that high consumption of sugary drinks can lead to adverse health effects, such as obesity, type 2 diabetes and heart disease. The desired effect of this tax is to reduce the amount of sugar the population is consuming, especially children and young adults.
A recent study has shown that this tax is making positive changes, as sales of sugary drinks in Berkeley have dropped by 10% since the tax’s inception, while sales in the region not effected by tax rose by just under 7%. Berkeley is a city known for its wealthy and educated population, so this may also be a factor in the consumption drop. Researchers cannot confirm a direct correlation, but over this past year the sale of bottled water has risen 15%.
Canada is also working on instituting a sugar tax of their own. A study released recently by the University of Waterloo estimates that a 20% tax on companies that make sugary drinks could save the lives of more than 13,000 people over the next 25 years. This would also amount to $11.5 billion in health care savings, and generate $43 billion in revenue for the government.
“We know Canadians – including our children – are consuming too much sugar and sugary drinks in particular are harming our health. These products are not essential groceries, providing little to no nutritional value, and a levy is one proven way to reduce consumption and support healthy living initiatives,” says Mary Lewis of the Heart and Stroke Foundation.