Did the sugar tax work? Here are the facts
Key Takeaways
Reduced consumption of sugar-sweetened beverages (SSBs) due to taxes has been linked to lower rates of obesity, diabetes, and heart disease among US consumers, potentially saving up to $53 billion in medical costs over a lifetime.
While some concerns exist about alternative sugary snack consumption and cross-border purchases, data does not support these fears.
Physicians and healthcare professionals are encouraged to advocate for SSB taxes to improve public health, regardless of where tax revenues are allocated.
Sugar-sweetened beverage (SSB) taxes are an emerging revenue source that have been enacted worldwide. The first such levy in the US was imposed in Berkeley, CA, via referendum 10 years ago, in 2014. This tax was a one-cent-per-ounce excise tax on SSB distribution, with artificially sweetened beverages exempt. The proceeds were earmarked for health and education.
The point of this tax and ones like it is to decrease the consumption of SSBs, thus promoting health outcomes. But have the taxes been effective?
Defining SSBs
SSBs are non-alcoholic beverages consisting of free sugars, including caloric sweeteners such as sucrose or high-fructose corn syrup, in addition to sugars found in fruit juices, honey, syrups, and fruit-juice concentrates. Examples include carbonated soft drinks, energy drinks, sweetened juices, sweetened teas and coffees, sports drinks, and sweetened waters.[]
The regular consumption of SSBs contributes to diabetes, obesity, and tooth decay. Dutch researchers writing in the Journal of Dental Research note that experts recommend that the public restrict sugar consumption to a maximum of 3% of daily calorie intake.[]
Even so, global per-capita consumption was projected to rise from 22.7 kg in 2018 to 24.2 kg in 2028. What’s more, only 10% of the world’s jurisdictions have passed SSB taxes.
Effectiveness of SSB tax
Following Berkeley’s initiative, the beneficial impact of an SSB tax became evident. SSB consumption declined in Berkeley’s lower-income neighborhoods within 1 year, and there was a 10% decrease in purchasing of SSBs at supermarkets. Similar results were noted after tax enactments in Mexico in 2013, Philadelphia in 2016, and Seattle in 2017.[]
A cross-sectional study published in 2024 in JAMA Health Forum analyzed the effects of SSB taxes on SSB prices and purchasing in Boulder, CO; Philadelphia; Oakland and San Francisco, CA; and Seattle.[] The researchers found that a composite increase of 33.1% in SSB prices correlated with a 33% decrease in purchases. Moreover, these findings were sustained and not offset by cross-border purchases.
“The findings have important implications for the potential efficacy of SSB taxes across larger geographic jurisdictions and at the national level,” the authors wrote.
"Scaling SSB excise taxes across the US would likely generate significant population health benefits and medical cost savings."
— Authors, JAMA Health Forum
A meta-analysis of real-world SSB tax assessments demonstrated that a 10% SSB tax resulted in a 10% decrease in consumption. Other studies have shown that a 15% to 20% increase in SSB price or decrease in consumption lowers the rates of myocardial infarction, coronary heart events, stroke, obesity, and diabetes.[]
From a financial perspective, a nationwide SSB tax could have obviated $17 billion in associated medical costs between 2010 and 2020. When projected to lifetime savings, this figure jumps to $53 billion in savings.
Downstream factors
Various ways to skirt the impact of SSB taxes have been observed or examined. The authors of the article in the Journal of Dental Research reported that, in Portugal, as the result of an SSB tax introduced in 2017, manufacturers decreased the sugar content in SSBs to less than 80 grams/liter, which was under the taxable threshold.
In the overall market, more than 60% of beverages were were under the 80 grams/liter threshold. Similarly, when the UK implemented an SSB tax in 2018, although the levels of consumption remained unchanged, the average sugar amount in such drinks fell by 10%.
Concerns have been raised that a decrease in SSB consumption may be offset by an increase in the consumption of other sugary snacks such as candies or cookies. However, this concern has not been supported by the data.
The role physicians play
Physicians have exhibited a long history of activism, coalizing, engagement, and debate when addressing social and policy change with regard to health threats. The successful anti-tobacco movements clearly demonstrated this. The SSB tax issue may be no different, with physicians pairing with dentists and other oral-health professionals to facilitate change.
Physicians understand the epidemiology of public health threats and are expert at communicating risk to non-experts. The SSB tax should be promoted irrespective of where the funding goes. In other words, whether the SSB tax benefits health initiatives or not—a stipulation that legislators may resist—it’s important for physicians and other healthcare professionals to advocate for change.
What this means for you
Based on the research, SSB taxes are an effective way to decrease consumption of SSBs and improve public health. Physicians are well-positioned to advocate for these taxes in public forums and encourage legislative change, regardless of how the funds are ultimately distributed.