No Health Benefits Seen with Small Soda Taxes

April 3, 2010— -- Taxes of a few percent on sugary drinks are unlikely to reduce consumption or improve children's health noticeably, researchers have found.

Health, diet, lifestyle and demographic data from a large study population of schoolchildren indicated that each 1 percent increment in so-called soda taxes reduced kids' mean body mass index (BMI) values by only 0.013 points, according to Roland Sturm of RAND Corp. in Santa Monica, Calif. and colleagues.

Effects on drink consumption overall and in school were also barely detectable.

"Small taxes in the range of existing differentials are unlikely to have visible effects at the population level," the researchers wrote online in Health Affairs.

But Sturm told MedPage Today in a telephone interview that heftier taxes -- such as an 18 percent levy proposed in 2008 in New York state, or a two-cents-per-ounce tax suggested last month by Pittsburgh's mayor -- could have a much more significant effect.

"As the tax increases, the effect will not be proportional," he said. "It will be larger."

Sturm and colleagues also found that small taxes had positive effects in certain subgroups, including African Americans, children already showing signs of excess weight, those from poorer households, and heavy TV watchers.

As a result, they suggested, taxes could still have a useful public health benefit.

But Sturm said their most important effect may simply be increasing revenue, which could be used to fund programs targeting childhood obesity and poor health behaviors.

The analysis used data from the prospective Early Childhood Longitudinal Study and its Kindergarten Cohort, a group of more than 7,000 children first recruited in 1998.

Information on the youngsters' diets, including their consumption of sweetened drinks other than fruit juices, as well as their purchases of such drinks at school, was collected in 2004 when they reached fifth grade.

Height and weight were measured regularly. The data also included sociodemographic information, children's weekly estimated time spent watching TV, and the frequency of vigorous exercise.

Sturm and colleagues matched the data on individual children with sales taxes on sodas in effect in their states of residence. In many states, such drinks are taxed at higher rates than other foods, and the difference was also included as a variable in the analysis.

Overall, there was little correlation between taxation and the fifth-graders' drink consumption or BMI. Body weight was significantly affected by taxation, however, among the 2,900 participants who were heavier than average and considered at risk for becoming formally overweight. Each 1 percent in taxes was associated with a reduction of 0.033 BMI points in this group.

Children from households with income less than $25,000 and those who watched more than nine hours of TV weekly also drank fewer sodas overall and in school -- by 0.029 to 0.142 per week, for each 1 percent of tax. But as was the case with African-American children, there was no discernible effect on BMI.

Sturm told MedPage Today that, despite these small numbers, the benefits of small to moderate taxation should not be discounted.

"I don't think this is a magic bullet for anything, but on the other hand, it will add up," he said.

He added that now might be a good time to push for higher taxes on sodas. In addition to the possible health benefits, modest though they may be, the revenue potential is substantial for local and state governments strapped for cash because of the recession.

In the Health Affairs paper, he and his colleagues suggested that structuring them as excise instead of sales taxes may boost their effectiveness.

"An excise tax is preferable... because it would be incorporated into the shelf price, making the higher costs more visible to consumers," they pointed out. They also indicated that a tax levied per ounce, such as the one proposed in Pittsburgh, would be easiest to implement