Jan 30, 2023 - News

Health experts say San Francisco's soda tax is working

soda bottles

Soda displayed at a San Francisco market in 2014. Photo: Justin Sullivan/Getty Images

San Francisco's soda tax reduced consumption of sugary drinks in the city by 34% in the first two years of its being in effect, according to a new report.

Why it matters: When city voters passed the penny-per-ounce soda tax in 2016, the supporters behind the initiative said the intent was to prevent diet-related health issues, like hospitalizations due to diabetes and hypertension.

  • Residents with low incomes, as well as people of color in San Francisco, drink sugary beverages at high rates, according to the city's health department.
  • Diabetes-related hospitalizations, for example, are about three times higher in low-income communities compared with higher-income communities in San Francisco.

By the numbers: Consumption of sugar-sweetened drinks in San Francisco dropped significantly in the first two years following the city's 2018 implementation of the tax, according to this week's study from the Public Health Institute's Prevention Policy Group.

  • The study, which surveyed more than 1,000 adults in San Francisco and San Jose in zip codes with high densities of Black and Latino people, found that consumption of sugary drinks declined 34.1%, compared to just 16.5% in nearby San Jose, which does not have a soda tax, according to the study.
  • In San Francisco, the probability of drinking more than 6 ounces of sugary drinks per day decreased by 13.6% in the two years following the implementation of the tax.
  • The tax generates more than $15 million every year, with the money going toward a variety of health and healthy-eating programs across the city, including Urban Sprouts, the Chinatown Task Force on Children's Oral Health and student nutrition services for the city's school district.

What they're saying: "The soda tax is working here in San Francisco — especially for communities most impacted by chronic disease," Abby Cabrera, co-chair of the city's soda tax advisory committee, said in a press release.

The other side: The American Beverage Association has argued that because merchants are allowed to pass on the cost of the tax to consumers, the law disproportionately impacts consumers with lower incomes and hurts small businesses.

  • The group has also expressed concern over job losses among retail employees as a result of declining sales.

Yes, but: A separate study found that the soda tax revenue sent back to lower-income communities exceeded the money those households paid for beverages as a result of the new tax.

  • “The bottom line is that most of the revenues were raised from higher-income households, and most of the revenues were invested in programs that benefited lower-income households," James Krieger, an author of the study, previously told Axios.

The big picture: The soda industry has lobbied against these soda taxes, and no such tax has been enacted in the country since 2018, The Guardian reports.

In California, that's in part due to state lawmakers in 2018 banning new soda taxes until 2031.

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