The Homa Files

TakeAway:  The latest headache for beverage marketers – the government has decided that adding an extra tax on sweetened beverages will help Americans lose weight and, thus, reduce health care costs .  Consumer goods companies are already taking deliberate measures to increase the health profile of product offerings.  Is government intervention necessary to help consumers make good food choices? At what point is it up to consumers to make healthy food choices?

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Excerpted from WSJ, “New Report Argues For Tax on Soft Drinks” By Betsy McKay and Valerie Bauerlein, September 16, 2009

A report published … by the New England Journal of Medicine … called for an excise tax of a penny per ounce on caloric soft drinks and other beverages that contain added sweeteners such as sucrose, high-fructose corn syrup or fruit-juice concentrates. Such a tax could reduce calorie consumption from sweetened beverages by at least 10% and generate revenue that governments could use to fund health programs, the authors said … “Escalating health-care costs, and the rising burden of diseases related to poor diet, create an urgent need for solutions, thus justifying government’s right to recoup costs.” … The latest report joins a growing drumbeat of calls for taxes on soft drinks and other sweet beverages, which some health experts compare to calls in earlier years for cigarette taxes …

Beverage-industry executives vehemently oppose the idea, which experts say would result in significant price increases … “A penny per ounce would have a seriously negative impact on the industry, as it could potentially raise prices on key packages by 40% to 50%,” said John Sicher, editor and publisher of Beverage Digest …

Currently, 33 states have sales taxes on soft drinks, but the taxes are too low to affect consumption and the revenues are not earmarked for health programs, the new report said.

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Full Article
http://online.wsj.com/article/SB10001424052970204518504574417380680508354.html

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Ken’s Take: How about taxing people by the pound – say, $10 per year per pound over the national height-weight guidelines?  Why just attack old people?  Let’s go after the heavies, too.

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This entry was posted on September 30, 2009 at 7:58 am and is filed under Health Care / Medical Insurance, Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.