New Study Indicates that New York's Proposed Sugary Beverage Tax Would Reduce Weight Gain in Youth

New York's Tax Could Result in a 20% Reduction in Excess BMI Gain

ALBANY. N.Y. (April 1, 2010) - Research reported today in the journal Health Affairs confirms that New York State's proposed 17 percent tax on soda and other sugary beverages would likely reduce soda consumption and obesity among youth.

The study found that higher taxes are associated with lower total consumption of soda. Higher soda taxes are also associated with significantly lower Body Mass Index (BMI) gain among heavier children, the report said.

The study found that smaller taxes, such as the sales taxes currently in effect on soda in some states, which average 3.5 percent and range up to 7 percent, "do not substantially affect overall levels of soda consumption or obesity rates." In effect, the smaller taxes do not provide a strong enough price signal to steer consumers toward lower-cost, healthier beverages such as water, low-fat milk, and diet soda.

The Rand Corp. study, which received funding from the federal government and the Robert Wood Johnson Foundation, reported that an 18 percent soda tax, however, does provide a price signal that would result in lower consumption of sugary beverages and lower weight gain. The researchers found that an 18 percent soda tax would correspond to about a "20 percent reduction of the excess BMI gain" for children between third and fifth grades.

New York's proposed penny-per-ounce tax averages out to a 17 percent overall increase in the price of non-diet sodas and other sugary drinks.

The nationally representative longitudinal study of more than 7,000 children followed from Kindergarten through 5th grade found that children reported an average consumption of more than 6 sodas per week.

The authors also noted that an excise tax like the one proposed for New York State "is preferable to a sales tax because it would be incorporated into the shelf price, making higher costs more visible to consumers."

The study also found that a soda tax may be most effective in reducing consumption of sugary beverages among children at greatest risk of obesity - identified as children who are already overweight, come from low-income families, or are African American.