A number of cities, Philadelphia, San Francisco, Seattle, and Boulder have put a tax on sugary drinks. Is this lowering the number of drinks that people buy? In many cases no, because taxes are invisible when a drink is taken off the shelf. The tax is added at purchase. If sugary drinks are part of a regular shopping trip, many shoppers do not even realize they are paying the tax, it simply becomes part of the total bill.
To examine the value of a tax on sugary drinks, researchers (A Salient Sugar Tax Decreases Sugary-Drink Buying – Grant E. Donnelly, Paige M. Guge, Ryan T. Howell, Leslie K. John, 2021 (sagepub.com) looked at various ways to alert shoppers to the tax. Noting the tax at time of purchase has no effect on the amount bought. Noting that the tax would benefit certain groups, such as student programs, also had no effect. When the phrase “includes sugary drink tax” was noted, amounts bought dropped. The researchers noted that the amount of the actual tax was not included along with the statement, but the researchers believed that the shoppers overestimated the tax amount which led to the reduced purchases.
