The sugar-sweetened beverage, or SSB, tax, implemented in Oakland in 2017, significantly reduced the number of purchases of soda and sugary drinks.
Sofia Villas-Boas, co-author of a PLOS Medicine study on the soda tax and campus professor of agricultural and resource economics, said the study estimated purchase reductions between 22% and 27%, using data up to two years after the implementation of the tax.
The study, which was published Tuesday, also compared the quantity of sugary drinks purchased in Oakland to that in comparable cities during the same time.
“Since taxes cause less purchases, our study shows the Oakland tax’s promise in effectively reducing sugary diet-related diseases and healthcare costs,” Villas-Boas said.
Villas-Boas noted they found no increases in sugary beverage purchases in neighboring cities, suggesting residents of Oakland did not travel elsewhere to buy these beverages while avoiding the tax.
Justin White, first author of the study, also noted there were no offsetting increases and purchases of sweet snacks in Oakland.
The study examined how the decrease in sugary beverage purchases caused by the tax affected the health and healthcare costs of Oakland residents, according to White. He explained the tax would reduce the risk of chronic disease conditions such as type 2 diabetes and heart disease, reducing long-term healthcare spending.
“This study makes the case that SSB taxes drive down consumption, lead to sustained impacts, and generate healthcare cost savings,” said co-author Scott Kaplan, assistant professor in the US Naval Academy Department of Economics and alumnus of the UC Berkeley Department of Agricultural and Resource Economics, in an email.
Kaplan said the study’s findings make a “compelling case” for the potential implementation of a state-level or nationwide sugar-sweetened beverage tax.
White noted a 2018 California law prohibits local jurisdictions from passing sugary beverage taxes. However, Ken Hecht, Berkeley Soda Commission member and director of policy at the University of California Nutrition Policy Institute, added it does not attempt to undo existing taxes. Such taxes were in Albany, Berkeley, Oakland and San Francisco, Hecht noted.
“(The study) calls into question whether California should be preempting local jurisdictions from being able to pass taxes,” White said. “There are implications of our study for whether or not there should be this kind of local experimentation with taxes of sugary beverages, given that we find that there’s improvements in health and reduced costs.”
Kaplan noted there is ongoing work aimed at understanding the effectiveness of sugar-sweetened beverage taxes across different locations with different sociodemographic profiles. White said looking at the effects in aggregate can inform the potential impacts of a national tax.
Councilmember Sophie Hahn said in an email Berkeley was the first major city to successfully tax sugar-sweetened beverages.
Hecht explained Berkeley’s sugar-sweetened beverage tax, which passed in 2014, contributed to tax revenue being placed toward community resources, including the Berkeley Unified School District and several community groups aimed at reducing negative health impacts.
With the sugar-sweetened beverage tax meant to bring awareness of healthier choices around added sugars and provide “vital funding” to community resources, Hahn expressed her support of the tax.
“As we continue to see the benefits of the sugar sweetened beverage tax in our community, it was clearly the right choice for our community,” Hahn said in the email.