Last week, Cook County, Illinois passed a penny-per-ounce tax on sweetened beverages just days after voters in four cities – San Francisco, Oakland, Albany California and Boulder Colorado – approved such taxes at the polls. Cornell University economist John Cawley has studied the effectiveness of soda taxes in Berkeley, California and says that while cities might be impacted differently –more can be done to maximize the benefits to public health.
Media Note: A video of Cawley explaining his latest research can be viewed on YouTube and downloaded here, https://cornell.box.com/v/CawleySodaTax along with Cawley’s recent paper about the effects of a new soda tax in Berkeley, California.
Cawley says: “Our study of the Berkeley tax found that only 43.1 percent of the Berkeley tax was passed on to consumers in the form of higher prices.
“Cook County is almost 100 times larger than Berkeley (945 versus 10 square miles), which will undoubtedly limit the extent of cross-border shopping to avoid the tax, and thus it is likely that a higher percentage of the tax will be passed on to consumers in Cook County than occurred in Berkeley.
“It is important to educate the distributors and store owners about the tax. We found that even a year and a half after the Berkeley tax took effect, some stores are charging the tax on diet sodas, which are specifically exempt by law. Such misapplication of the tax decreases incentives for consumers to switch to lower-calorie options, and overcharges consumers.
“The fascinating question going forward is how many additional cities, counties, and states will enact such taxes, and what impact they have on sales, consumption, and ultimately, public health.”
Cornell University has television, ISDN and dedicated Skype/Google+ Hangout studios available for media interviews.- 30 -
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