Can a beverage tax on sweet drinks improve health outcomes?

By Jules Murtha | Medically reviewed by Courtney Manser, MD, CCFP (PC)
Published April 17, 2023

Key Takeaways

  • The consumption of sugar-sweetened beverages (SSBs) is linked with obesity, type 2 diabetes, heart disease, and kidney disease, as well as other  diseases, according to the CDC.

  • Research reveals an association between a beverage tax and reduced tooth decay in children and adults on Medicaid in Philadelphia. However, there was no significant association in the general population. Therefore, low-income communities may benefit the most from SSB taxes.

  • In order to ethically implement SSB taxes, experts say that tax proposals may incorporate plans to invest SSB tax revenue in education programs, community infrastructure, food subsidies, and other avenues that increase equitability among low-income communities.

Sodas, fruit drinks, energy drinks—these are just a few examples of sugar-sweetened beverages (SSBs), which, the CDC states, are heavily associated with a wide range of poor health outcomes.[]

Beverage taxes on SSBs have been proposed as a way to curb the negative health impacts associated with these drinks. In order to ethically implement SSB taxes, it is important for policymakers to consult with the populations most likely to be affected by them. Physicians, for their part, can continue to make their patients aware of the detrimental impact that SSB consumption has on health.

SSB taxes may improve health outcomes

It has long been documented that the consumption of SSBs is associated with the development of type 2 diabetes, heart disease, kidney disease, and other conditions.

It is also known that a tax can cut down on the purchase of SSBs. But is there a corresponding improvement in health outcomes? Research done to date provides evidence that the answer is yes.

A 2023 study published by the American Journal of Preventive Medicine looked at the effect of a beverage tax in Philadelphia on the dental health of children and adults of various income levels.[]

Researchers obtained electronic dental record data from 83,260 patients based in Philadelphia and control areas between 2014-2019. They used difference-in-differences analyses to compare the number of new decayed, missing, and filled teeth in children and adults before and after the beverage tax was imposed.

Among the general population, there was no significant change in rates of tooth decay. 

Among the Medicaid population, however, there were substantial changes. Specifically, older children and adults showed a 22% decline in tooth decay, while young children showed a 30% decline after implementation of the SSB tax. 

These findings suggest that a beverage tax may offer potential health benefits for low-income patients.

In addition to this study, other literature supports the notion that SSB taxes are an effective means to mitigate negative health outcomes.

A 2020 article published by Physiology & Behavior says there is plentiful evidence that SSB taxes successfully reduce the purchase and consumption of SSBs.[] 

As a result, people are less likely to engage in a health behavior—ie, consumption of sweetened beverages—that is linked with weight gain and risk of cardiometabolic disease, and all without placing harsh restrictions on their ability to choose.

"Regarding liberty, SSB taxes do not eliminate the option of buying SSBs."--Authors, Physiology & Behavior article"

Authors, Physiology & Behavior article

Meanwhile, the tax can expand beverage options by funding drinking water availability and prompting industry reformulation, and expand overall freedom by averting poor health.”

Socioeconomic implications of SSB taxes

Since low-income communities are the most likely to purchase SSBs, these communities will therefore shoulder the greatest financial burden relating to SSB taxes, according to a 2022 article published by JAMA Network Open.[]

Because of this, policymakers may need to consider how the SSB tax revenue can best support the overall well-being of those affected. Some examples include delegating tax revenue to education programs, workforce development, and food subsidies, as well as other programs that aim to create a more equitable society for all.

The authors elaborate on the importance of including low-income communities in the establishment of SSB taxes.

“Jurisdictions that consider implementing these taxes should continue to design them in consultation with lower-income and marginalized communities,” the authors wrote. “These communities may bear the short-term burden of the tax, even if they reap longer-term benefits, so it is especially important that the revenue is reinvested in ways that support their social and economic needs.”

Help patients learn the facts

At the moment, more research needs to be done to evaluate SSB taxes. While policymakers are determining if and how to put SSB taxes to the test, physicians can continue to teach patients about the harms associated with SSBs.

For example, the CDC states that the consumption of SSBs is also linked with other unhealthy behaviors, such as smoking, getting little sleep and exercise, and eating fast food often.

Adolescents who frequently drink SSBs are more likely to engage in screen time in the form of TV, video games, cell phone use, and computer use.

All in all, patients who limit their consumption of SSBs are more likely to achieve better overall health—even though, as the JAMA Network Open authors recognize, a single policy change may not in itself be enough to impact complex, chronic diseases at the population level. Nonetheless, improving people’s overall diet is worthwhile. And reducing SSB purchases may just save people a little money.

What this means for you

The consumption of SSBs has known associations with a vast array of diseases, including heart disease and type 2 diabetes. One way to potentially mitigate poor health outcomes connected with consuming SSBs is by implementing a beverage tax. Benefits to low-income populations from beverage taxes have been demonstrated, such as by reduced tooth decay among children and adults on Medicaid after implementation of a tax. While the issue is being debated, clinicians can continue informing patients of the unhealthy behaviors and outcomes associated with SSB consumption.

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