The state assemblymember representing Santa Monica is introducing a bill that would tax soda and sugar-sweetened beverages – for the third time.
Richard Bloom, a Democrat who represents the Westside in the California State Assembly and served as Mayor of Santa Monica, announced yesterday that he is introducing legislation to tax soda sold in California as a way to tackle the state’s diabetes and obesity problems. The revenue from the tax, which is intended to be a disincentive to purchasing soda and sugary drinks, will fund programs that prevent diabetes and obesity.
California is last in funding for diabetes prevention efforts, Bloom said. Nine percent of Californians are diabetic and 46 percent are prediabetic, he added. Two-thirds of prediabetics will develop the condition.
“Everyone would acknowledge that healthcare costs are skyrocketing, and one of the reasons why is our health is getting worse,” he said. “Diabetes and obesity are going healthcare crises and we need to get serious about prevention.”
Soda and sugary drinks are the largest source of added sugar in the American diet and added sugar contributes to diabetes, obesity and heart disease, said Susan Babey, co-director of the Chronic Disease Program at UCLA.
This is the third time Bloom is introducing a soda tax in the state assembly. His first attempt failed in the Assembly Health Committee by four votes in May 2015 and Bloom pulled his second bill ahead of its first committee vote in April 2016. Both bills proposed a tax of 2 cents per fluid ounce of soda, or about $0.66 for a liter bottle.
Bloom introduced Assembly Bill 138 alongside four other pieces of legislation targeted at reducing the amount of soda Californians consume, including bans on large drinks and displays of soda near checkout counters in stores.
The bills follow state legislature vote made under pressure from the American Beverage Association (ABA) to ban new local soda taxes until 2031. The ABA has spent millions of dollars around the country to defeat soda taxes and related legislation, but four California cities – Berkeley, San Francisco, Oakland and Albany – have passed taxes on sugary drinks.
Bloom said he is reintroducing the bill because people in cities that have passed soda taxes are purchasing and consuming less soda and generating revenue to fund health programs.
Babey said there is a small but growing amount of evidence that sugary beverage taxes reduce purchasing and other studies suggest they may reduce consumption, but not enough research has been conducted on how taxes affect consumption. Tobacco taxes have also set a historical precedent that taxes reduce consumption over time, she added.
Some experts, however, disagree. Michael Thom, a University of Southern California professor and an expert on tax incentives, said much of the research making the argument that soda taxes reduce consumption is based on statistical simulations, not real-world cases where soda taxes have been implemented.
“Real world studies come to a very different conclusion, and that’s that soda taxes have little to no long-term effect on consumption or overall health. In fact, sometimes the taxes backfire,” Thom said. “The authors of a study on Berkeley’s soda tax found soda consumption dropped the equivalent of six calories per day following the city’s soda tax, but that consumers added 32 calories per day from other un-taxed sugary beverages, like milkshakes.”
Bloom said he is optimistic about the future of the bill despite its failure in 2015 because support among legislators for soda legislation has grown, California has a new governor and more public awareness exists around the health issues caused by soda.
Critics of the bill’s previous iterations have criticized it as a regressive tax on the poor.
“Most taxes like this have a disproportionate impact on the poor, no matter what product the government is targeting,” Thom said. “If the product is something the poor are more likely to buy, like soda, then the regressivity is even worse.”
Bloom said such criticism is misguided.
“Tobacco taxes are regressive too, but nobody today would argue it’s a bad idea to have tobacco taxes to lower tobacco consumption,” he said.