OPINIONRetailers

Updates on the Soda Debacle

Two things about soda that supermarket retailers need to know

The Lempert Report

In 2016, Philadelphia became the first major U.S. city to pass a soda tax as public health advocates predicted many other cities would follow in Philadelphia’s footsteps. Philadelphia’s 1.5 cents-per-ounce tax has raised more than $200 million since it took effect in 2017. The revenue funds pre-K, community schools and improvements to parks, recreation centers and libraries, making it politically harder to repeal.  

Only a total of seven cities—Seattle; Boulder, Colo.; San Francisco, Oakland and Berkeley, Calif.; and Albany, N.Y.—levy a tax on soda distribution, and Philadelphia is the only one on the East Coast to do so, according to The Tax Policy Center, a Washington think tank. No new taxes have taken effect since January 2018. The beverage industry has mounted an effective counteroffensive in the past three years, backing state “preemption” legislation that now bans municipalities from passing new taxes in Arizona, California, Michigan and Washington.

In Philadelphia, the American Beverage Association spent almost $19 million fighting the tax from 2016 through last September.

The second thing to know is that a Dutch research group, NIZO, found that naturally occurring aromas can reduce the sugar content of flavored beverages while keeping the sweet taste. There is no doubt that people are trying to reduce the amount of sugars they consume and that we need a better solution than just loading up foods, and sodas with artificial sweeteners is not the answer in an era where shoppers are seeking more natural ingredients. 

Perhaps the better solution to the soda problem is to reengineer soda with innovations like this to align with the nutritional values of shoppers—rather than to waste millions of dollars in fighting soda taxes.

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