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5/14/10

Are Taxes the Answer?


Time magazine recently had an article online entitled Study: Sin Taxes Promote Healthier Food Choices.  Apparently there was a study tracking a group of 5,000 from 1985-1986 to 2005-2006. The study tracked their food consumption, height, weight, and blood sugar levels (as a side note, can you imagine participating in a study for that long? I can't!) They compared the data that they gathered from the participants with information about food prices across the 20 year period, and found that as the prices of unhealthy foods rose steadily, people tended to eat less of them.

Breaking it down into numbers, the study showed that for every 10% increase in the cost of foods, there was a decline in the consumption - 7% for soda and 11.5% for pizza. 



 Even more than that,  a $1 increase in the price of soda was correlated with a lower overall daily caloric intake (124 less), lower overall body weight (2.2 pounds on average), and better blood sugar levels. 

The lead author of the study Kiyah Duffey, of the University of North Carolina at Chapel Hill Department of Nutrition thinks that these results could possibly support the case for adding a sort of "sin tax" on unhealthy foods. They suggest that by adding an 18% tax on soda and pizza, on average they could cut calories by 54 calories per person per day, which would lead to a 5 pound weight loss per person over the course of a year. 

The end of the article briefly sums up the debate over the idea of a sin tax added to foods, and ends by saying "for many, the growing effort to govern food choices through tariffs goes too far." 

I don't really want to get into the politics here, but I have a few problems with the end of the article. I, for one, think that it would be a great idea to add a sin tax to things like soda (and why not add it to all processed foods, or just stop subsidizing corn and soybeans, but that is another post for another day). Perhaps if the sin tax was added, people would approach these foods more as a "treat" than as an everyday occurrence. If you figure that delivery pizza costs around $15, you would be paying around $17.70 for the pizza with an 18% surcharge. Sure, that brings up the prize. But unless you are eating delivery pizza every single day of your life, then it won't break the bank. And perhaps it would encourage people to not eat it every day of their lives.

The problem that I have with the end of the article is that I find it absurd that people think that the government doesn't have a right to do anything to our food choices (although they already do, by the aforementioned subsidies, making organic certification so expensive, having lobbyist, etc) but meanwhile, the cost of obesity in this country hovers somewhere around $147 billion dollars per year. For something that is costing the government, insurance companies, Medicare, Medicaid, and individuals so much money, why shouldn't they have any ability to tax the foods that contribute to its cause? 

I'm not saying that the government should outlaw soda and pizza. Ultimately I do think people have a right to choose what they are eating, but a sin tax doesn't outlaw anything. It simply makes it that much more expensive to engage in your bad habits, similar to alcohol tax and cigarette tax. If you still want to go out and get a beer, by all means do. However, it isn't going to come cheap. The same applies to other foods, and while I don't think the sin tax should be limited to just soda and pizza, as clearly those are not the only foods contributing to the obesity epidemic, I think it is a starting point. 

What do you think? Would you support a sin tax on foods? I want to hear your thoughts!

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