Pop Goes the Soda Tax

What is the goal of the Mayor of Pittsburgh’s piggybacking on Philadelphia’s idea to tax sugary drinks? Is it to combat obesity, raise money for the City’s pension fund, or both? From all published reports to date it would be fair to argue that the revenue goal is the overarching end game. Much like Allegheny County’s poured alcohol tax which never carried the temperance banner.

But could a sugary drink tax in Pittsburgh actually work to make a dent in the so called obesity epidemic? According to researchers at RAND, who recently conducted a study on sugary drink taxes, "small taxes will not prevent obesity". They found that the tax would have to be high enough to do more than, say, keep a person who drinks ten cans of pop a week to just cut back to nine.

At 2 cents per ounce tax, which would add 24 cents to the price of a can of pop or $2 to a two liter bottle, the Pittsburgh-Philadelphia sugary tax idea might be the level at which consumption might fall.

That would of course work against the goal of the Mayor-the more money garnered from the tax for pensions the better, at least from his view. He would not want too much of a decline in consumption because of the tax.