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California preps for soda tax showdown

AP

If two of the most progressive U.S. cities don’t pass a tax on sugary drinks, will the idea finally fizzle out?

Sugary drinks have been under fire for years, with many blaming them for rising rates of obesity and chronic diseases. Yet efforts to curb consumption by imposing taxes and other measures have failed, most famously in New York City, in part because the beverage industry has spent millions to defeat the efforts.

Now, the question of whether a bottle of Dr. Pepper with 64 grams of sugar should be treated like a pack of cigarettes is being considered in San Francisco and Berkeley, with the two California cities aiming to become America’s first to pass per-ounce taxes on sugary drinks.

Overall, Americans have been cutting back on soda for years, with sales volume down about 13 percent over the past decade, according to the industry tracker Beverage Digest. But other sugary beverages with healthier images have climbed; sports drinks, for instance, are up about 35 percent.

France and other countries have imposed taxes on sugary drinks in the meantime. Mexico, which has one of the highest obesity and soda consumption rates in the world, passed a tax on sugary drinks last year.

Back in the U.S., critics have persisted. California lawmakers considered a measure that would have slapped a warning label on sodas before it was ultimately defeated last month.

The stakes are high, especially given the San Francisco Bay Area’s reputation for liberal politics. If approved, Coca-Cola, PepsiCo. and other companies fear it could galvanize health advocates elsewhere. If defeated, the idea of a soda tax could be dead.

“The industry is really motivated to beat us here. If they can beat us in San Francisco and Berkeley, nobody is going to take them on,” said Larry Tramutola, the political consultant handling the campaign in support of the tax in Berkeley.

The odds aren’t in favor of taxes. Since 2009, about 30 special taxes on sugary drinks have been introduced around the U.S. Few have gained traction and none have prevailed. Chris Gindlesperger, a spokesman for the American Beverage Association, the lobbying group for Coke and Pepsi, says the failures show people don’t support the idea.

Others say the industry uses unfair tactics to defeat measures, such as setting up groups with names like “Citizens Against Beverage Taxes,” which sound like they are community-driven but aren’t. They are nevertheless influential in shaping people’s attitudes.

Taxing a product to discourage use has proven effective with cigarettes. According to the American Cancer Society, there’s a 4 percent decline in overall smoking rates for every 10 percent hike in cost. Still, at least one study has questioned how effective a tax on sugary drinks could be since people might just spend their money on other high calorie foods.

In New York City, former Mayor Michael Bloomberg pushed to cap the size of sugary drinks sold in restaurants and other venues at 16 ounces (453 grams). The move was shot down in the courts after legal challenges spearheaded by the beverage industry, which also waged a heavy marketing campaign. Some ads featured the Statue of Liberty holding up a giant soda instead of a torch.

“Overall, we lost the PR war,” said Thomas Farley, the city’s health commissioner at the time.

In San Francisco and Berkeley, supporters of the tax say they’re better organized to battle the soda industry’s tactics. They’re hitting the streets to educate voters and plan to run TV ads, work phone banks and mail fliers.

“In other places, bless their hearts, but they were ill-prepared for what was coming at them” said Maggie Muir, a consultant who was hired by San Francisco lawmakers to lead the political committee in support of the soda tax.