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Hit-Or-Miss

Philly’s Soda Tax Is The First Of Its Kind, And It’s Expensive AF

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Philadelphians will soon be paying extra on some of their sweeter drinks after Philadelphia just became the first major U.S. city to successfully pass a soda tax.

The Sugar-Sweetened Beverage Tax, as it’s officially named, will be 1.5 cents per ounce and taxes items including non-100% fruit drinks, flavored water, pre-sweetened tea or coffee, non-alcoholic beverages that are intended as mixers for alcoholic drinks and flavored water. Philly.com reported that the tax is expected to add up to 18 cents to the cost of a 12-ounce can, $1 to a 1-liter bottle and about $2.16 to the cost of a 12-pack.

Exceptions to the law will include baby formula and products more than 50 percent fruit or vegetable juice.

The passing of the tax follows months of controversy. While the tax passed with a 13-4 vote and was supported by Philadelphia mayor, Jim Kenney, the vote followed a multi million dollar opposition campaign by the beverage industry. Following the vote, the American Beverage released a statement saying it will seek legal action to stop the law, saying it “unfairly singles out beverages,” and calling taxes of this kind “discriminatory and highly unpopular.”

Kenney was able to sell the idea of the tax with the plan to use the expected $90 million to support pre-kindergarten, community schools and recreation centers.

Berkeley, California previously passed a similar tax, but no major U.S. city has been able to pass such a tax. Other major cities who tried in the past to pass similar soda taxes include New York and San Francisco.

With the tax set to go into effect on January 1 maybe it will give Philadelphians the incentive they need to follow through on their New Year’s Resolutions to kick soda.

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Hit-Or-Miss

Turns Out Mexico’s Soda Tax Is Totally Working

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Last year, Mexico implemented a soda tax to discourage consumers from drinking too much sugar. Carbonated beverages were priced at one peso for every liter throughout the country, Wired reports. This change increased soda costs by 10 percent.

On average, Mexicans consume about 43 gallons of soda per capita annually. This comes out to 40 percent more than the United States. The neighboring countries, however, are pretty close when it comes to diabetes rates among the adult population.

Since the tax, soda purchases dropped six percent and rose to 12 percent by the end of the year.

We’d say that’s a success. Now, it looks like consumer advocates working to remove taxes from the sales of bottled water and raise the tax for sodas even further. The goal is to deter people from sugar with crazy expensive soda and cheap, clean water.

Hopefully, if the US decides to catch up to Mexico’s soda model, we’ll see a lot less diabetes.

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News

Mexico Surpasses United States in Obesity: Approves Junk Food Tax

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Bad news for our friends south of the border. Mexico’s lower house of Congress is following in the steps of New York Mayor Bloomberg by recently approving new taxes on junk food in an effort to reduce their consumption. The increased costs on higher calorie and sugary snacks were part of a larger bill that included additional fiscal changes and are likely to get passed into law.

With one of the world’s highest obesity rates, Mexico is being met with support from health experts and opposition from small business owners. Mom and Pop shops rely on soft drink sales to stay open and will likely have to close their doors if their customers are deterred from indulging in their favorite treats.

According to the legislation high-calorie foods defined as “those providing 275 calories or more per 100 grams, at 5% of the ticketed price and chewing gum at 16%. Soft drinks would go up in price about 8 cents per liter.” Mexico recently bumped the United States into the #2 spot with 32.8% of adults considered obese vs. 31.8% in the US.

Approval of the tax package, including the junk food tax, would generate nearly $20 billion in revenue for Mexico’s national treasury.

H/T LA Times