A common proposal to encourage healthy eating involves raising the price of unhealthy food. For example, the logic assumes that if soda prices were to skyrocket, then people would find a healthier drink to include in their diet, and that would solve part of the obesity problem in America.
Not so fast. Taxing sodas in an effort to reduce obesity has proven ineffective time after time.
A 2011 study found that people find substitutes for those calories. A popular alternative was beer. Those people, on average, would consume 2,000 more calories per month of the libation.
“This raises the question of switching one public policy problem to another,” said Tax Foundation economist Scott Drenkard, a panelist at Wednesday night’s even at The Fund for American Studies titled, “Scared to Death: How Government Nannies Are Creating A Culture of Alarmism.”
One of those problems includes the negative economic effect of increasing soda taxes on lower income individuals. They will buy the same amount, which results in spending a greater percentage of their income on soda instead of ceasing to purchase the product.
In 2011, 23 states considered a penny-per-ounce soda tax. The main motive was to reduce obesity. The $1.28 per gallon was the average tax for most of those states. Comparatively, most states have beer excise tax rates of 20 or 30 cents per gallon. Tennessee ranked highest at $1.17 per gallon.
“We’ve gone far from whatever economical rationale there might be for having a tax on food,” Drenkard said.
The tax code has proven to be a horrible alternative time and again as a failed method to combat obesity. This problem will only be solved when individuals make the decision to live a healthier lifestyle and employ good old fashioned personal responsibility.