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California lawmaker lobbies for sweetened-beverage tax

Bottles of Snapple ice tea and juice drink are displayed along with bottles of Coke at the Fog Hill Market in San Francisco,

TEXT OF STORY

BOB MOON: There's a move here in California to have the state to jump on the nationwide bandwagon for a new kind of "sin tax." And, we've got LA Times consumer columnist David Lazarus in the studio to talk about it. Good morning, David.

DAVID LAZARUS: Good morning.

MOON: So what is California proposing here?

LAZARUS: Well, a California law maker William Monning is proposing a penny-per-ounce tax on sweetened beverages. You're talking soda, you're talking sports drinks, you're talking energy drinks.

MOON: Isn't this going to hit low income people the hardest?

LAZARUS: Well, probably, because many studies show that lower income communities and minority communities tend to be some of the highest users of soda pop. On the other hand, if that's where the obesity crisis is biggest, perhaps that's where you need to target. And right now, what we're seeing is black communities, Latino communities, have disproportionally higher levels of obesity. And over all in America, two-thirds of U.S. adults are either overweight or obese right now, so the problem is profound.

MOON: Now this amounts to a "sin-tax." Do we know how effective it's been in other states that have instituted this?

LAZARUS: You know it varies with that sort of thing. For example in 2009, The New England Journal of Medicine said that these sorts of taxes are a very good way to combat the obesity crisis. On the other hand last year the Rand Corporation came out with a report that said soda taxes that are at their current levels of about 4 percent or so, are not really going to do the job. People will simply pay that extra amount for their sugar fix. On the other hand, Rand found that if you had a soda tax on the 18 percent range, or 18 cents for every dollar, that would have a big impact.

MOON: But a few pennies, does that really discourage consumption? I mean I'm already paying, in some cases, $5 or $6 for a six-pack of sugar water.

LAZARUS: All true, and you'll probably pay whatever you want if you want your fix. On the other hand, if our goal is to try and create resources that would give Americans just better opportunities to be physically fit -- bike paths, basketball quarts, gym memberships -- well that money has to come from somewhere and as with all sin-taxes, you're taking a negative behavior and trying to turn it into a positive.

MOON: Brace yourself, huh, if you're really into that sugar fix.

LAZARUS: Or get up and take a walk.

MOON: David Lazarus is consumer columnist for the Los Angeles Times. Thanks for joining us.

LAZARUS: Thank you.

About the author

Bob Moon is Marketplace’s senior business correspondent, based in Los Angeles.

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