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A Tax On Soda Slashes Soda Consumption In California

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Robert Donachie Capitol Hill and Health Care Reporter

A new study shows that the tax on soda and sugary beverages has dropped consumption on said drinks by a fifth in low-income neighborhoods of Berkley, Calif.

California was the first state in the nation to pass a tax on sugary drinks in March of 2015, in efforts to encourage more healthy behavior.

The study found that consumption of sugary drinks in neighborhoods surrounding Berkley fell by 21 percent and many residents switched to water as a result of price increases. Water consumption in Berkley rose by 63 percent and by 19 percent in the low-income neighborhoods surrounding the city, reports the LA Times.

It’s not at all surprising to see consumption drop in low-income neighborhoods where price increases (even marginal increases) have drastic effects on an individual’s ability to purchase goods and services.

Other cities in California like San Francisco and Oakland are expected to vote on a sugary drink tax in the November elections, according to the Wall Street Journal. Philadelphia has already passed a 1.5 per ounce tax on sugary drinks, making it the second city in American to pass such an initiative.

In addition, some two dozen states have considered such a tax.

The United States isn’t the only nation to create a consumption tax on sugary beverages, Mexico instituted a 10 percent tax on sugary drinks in 2014 to combat rising obesity in the nation. The tax, however, did nothing to curb consumption with a rise in the number of sodas and other sugary beverages reported in 2016, the Journal reports.

Coca Cola, Dr Pepper Snapple, and Pepsi have come out saying the tax is unfair and that the companies are considering legal action to challenge these laws.

Only time will tell how the market for soda and sugary beverages plays out, with more U.S. cities and states voting in the coming year on a sugary drink tax.

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