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Oakland's Soda Tax Cut Local Sales by 27%
  • Posted April 18, 2023

Oakland's Soda Tax Cut Local Sales by 27%

Could taxing soda cut down on the consumption of sugary drinks?

That's exactly what happened when a local “soda tax” was launched in Oakland, Calif., according to researchers from the University of California, San Francisco.

Purchases of sugar-sweetened beverages dropped nearly 27% between July 2017 and December 2019, after the one-cent-per-ounce tax began.

“These results suggest SSB [sugar-sweetened beverage] taxes can meaningfully improve diet and health and generate substantial cost savings over a sustained period of time, all of which support the case for a national tax on SSBs,” said senior study author Dr. Dean Schillinger, a UCSF professor of medicine and a co-chair of the National Clinical Care Commission (NCCC), formed by Congress to advise on diabetes policy. The NCCC has recommended a national tax on sugary beverages.

“The American Beverage Association cornered the California legislature into passing the law barring further SSB taxes in our state. Voters now have evidence that allowing such taxes can yield significant benefits to society, and we hope that legislators at the state and national level act on these findings,” Schillinger said in an UCSF news release.

Schillinger was referring to a prohibition on new soda taxes enacted by California state legislators about five years ago. Existing taxes in the California cities of Oakland, San Francisco, Berkeley and Albany were grandfathered in.

To study the impact of the soda tax on health, researchers compared sugary drink purchases in Oakland to purchases in nearby Richmond, Calif., and Los Angeles, both 30 months before the Oakland tax started and then after.

Purchases declined in Oakland for all types of sugary beverages, including sweetened soda by 23.1%, fruit drinks by 30.4%, sports drinks by 42.4% and sweetened teas by 24.4%.

Using computer modeling, the investigators estimated how reduced sugary beverage purchases affected community health through quality-adjusted life-years (QALYs). They calculated the health care cost savings of preventing or controlling diabetes, heart disease, stroke and gum disease.

As it turns out, consuming 26.8% fewer sugary beverages over 10 years added 94 QALYs per 10,000 residents, according to the research. It also saved the city more than $100,000 per 10,000 residents in health care costs.

Gains were expected to increase over a lifetime. And the investigators did not account for the positive impacts of the local nutrition and public health programs funded by the additional tax revenue in Oakland, Schillinger added.

The research team also found no evidence that consumers crossed borders to buy sugary drinks in neighboring untaxed locations.

“Our estimates suggest this tax is at least as cost-effective as other widely recognized public health interventions such as smoke-free workplace policies and air pollution control measures,” first study author Justin White said in the release. He's an associate professor of health economics at UCSF's Philip R. Lee Institute for Health Policy Studies.

The findings were published April 18 in the journal PLOS Medicine.

More information

The U.S. Centers for Disease Control and Prevention has more on sugar-sweetened beverages.

SOURCE: University of California, San Francisco, news release, April 18, 2023

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