Soda Tax Weighed to Pay for Health Care

[me]

Soda Tax Weighed to Pay for Health Care
By JANET ADAMY

Senate leaders are considering new federal taxes on soda and other sugary drinks to help pay for an overhaul of the nation's health-care system.

The taxes would pay for only a fraction of the cost to expand health-insurance coverage to all Americans and would face strong opposition from the beverage industry. They also could spark a backlash from consumers who would have to pay several cents more for a soft drink.

On Tuesday, the Senate Finance Committee is set to hear proposals from about a dozen experts about how to pay for the comprehensive health-care overhaul that President Barack Obama wants to enact this year. Early estimates put the cost of the plan at around $1.2 trillion. The administration has so far only earmarked funds for about half of that amount.

The Center for Science in the Public Interest, a Washington-based watchdog group that pressures food companies to make healthier products, plans to propose a federal excise tax on soda, certain fruit drinks, energy drinks, sports drinks and ready-to-drink teas. It would not include most diet beverages. Excise taxes are levied on goods and manufacturers typically pass them on to consumers.

Senior staff members for some Democratic senators at the center of the effort to craft health-care legislation are weighing the idea behind closed doors, Senate aides said.

The Congressional Budget Office, which is providing lawmakers with cost estimates for each potential change in the health overhaul, included the option in a broad report on health-system financing in December. The office estimated that adding a tax of three cents per 12-ounce serving to these types of sweetened drinks would generate $24 billion over the next four years. So far, lawmakers have not indicated how big a tax they are considering.

Proponents of the tax cite research showing that consuming sugar-sweetened drinks can lead to obesity, diabetes and other ailments. They say the tax would lower consumption, reduce health problems and save medical costs. At least a dozen states already have some type of taxes on sugary beverages, said Michael Jacobson, executive director of the Center for Science in the Public Interest.

"Soda is clearly one of the most harmful products in the food supply, and it's something government should discourage the consumption of," Mr. Jacobson said.

The main beverage lobby that represents Coca-Cola Co., PepsiCo Inc., Kraft Foods Inc. and other companies said such a tax would unfairly hit lower-income Americans and wouldn't deter consumption.

"Taxes are not going to teach our children how to have a healthy lifestyle," said Susan Neely, president of the American Beverage Association. Instead, the association says it's backing programs that limit sugary beverage consumption in schools.

Some recent state proposals along the same lines have met stiff opposition. New York Gov. David Paterson recently agreed to drop a proposal for an 18% tax on sugary drinks after facing an outcry from the beverage industry and New Yorkers.

The beverage-tax proposal would apply to drinks that many Americans don't consider unhealthy -- such as PepsiCo's Gatorade and Kraft's Capri Sun -- based on their calorie content.

Health advocates are floating other so-called sin tax proposals and food regulations as part of the government's health-care overhaul. Mr. Jacobson also plans to propose Tuesday that the government sharply raise taxes on alcohol, move to largely eliminate artificial trans fat from food and move to reduce the sodium content in packaged and restaurant food.

The beverage tax is just one of hundreds of ideas that lawmakers are weighing to finance the health-care plans. They're expected to narrow the list in coming weeks.

The White House, meanwhile, is pulling together private health groups to identify cost savings that will help fund the health overhaul. Mr. Obama on Monday held a White House meeting with groups that represent doctors, hospitals, insurers, pharmaceutical companies and medical-device makers. They pledged to help restrain cost increases in the health-care system in an effort to save $2 trillion over the next decade.

"When it comes to health-care spending, we are on an unsustainable course that threatens the financial stability of families, businesses and government itself," Mr. Obama told reporters.

Write to Janet Adamy at janet.adamy@wsj.com

http://online.wsj.com/article/SB124208505896608647.html

I can't believe they see sugar as harmful to a persons health with all the things that are caused by consuming artificial sweeteners.  Way to go congress.  Tax some more and put some more people out of work....

[kimmi]

I see nothing wrong with it.  I wish they would tax fast food as well. 

[LOsborne]

I'm with you, Kimmi. If taxes have to go up (what do I mean if?) I very much prefer to see an increase I can choose whether or not to pay. I don't have to drink soda. To avoid this tax, all I have to do is stop buying it.

The governments (both state and fed) must find an untapped revenue source, since the increased taxes on cigarettes and liquor have led to fewer and fewer people smoking and drinking -- at least smoking and drinking less.

Taxing unnecessary consumables is far better, in my opinion, than just slicing a chunk off every dollar I earn.

[Henry Hawk]

how about we quit spending so damn much money and layoff taxing everybody under the sun.....it is not governments job to try to FIX everybody's problems.....maybe, just maybe if those bastards in Washington quit .... spending on hippy museums and frisbee golf courses...(just to name a couple of the cuff)....get back to what our Constitution says it is suppose to do...

[LOsborne]

Now, Henry, you know the big ticket items are not frisbee golf course and esoteric museums. The real money hogs are roads (I want those potholes fixed!), Law Enforcement, Fire Departments, schools, the military ... oh yeah, and salaries for legislators ... we could probably trim some there. Eliminating your pet-peeve projects, or mine, won't solve the problem. We still have to pay for infrastructure. Unless we stop drinking Pepsi, of course.

[Henry Hawk]

Now, Henry, you know the big ticket items are not frisbee golf course and esoteric museums. The real money hogs are roads (I want those potholes fixed!), Law Enforcement, Fire Departments, schools, the military ... oh yeah, and salaries for legislators ... we could probably trim some there. Eliminating your pet-peeve projects, or mine, won't solve the problem. We still have to pay for infrastructure. Unless we stop drinking Pepsi, of course.

I have no problem with stop drinking Pepsi...it is Coke that is my crutch..

Our Military is our number one reason for having Taxes in the first place....fire dept and schools and our legislators should be more of a State issue....but social security, though it was intended as a good thing....is a form of individual welfare that is not authorized in the Constitution...which is only to promote the General Welfare....and I know this is open to a big argument.....

Honestly our Federal Government has stepped WAY out of bounds on numerous issues...this is from ALL parties...we have GOT to get back to it's original intent.....it is WAY out of control and has been for years...

it is scary..

[me]

Sure we give up everything to pay for something which is a bad idea to begin with.  The thing is diet soda and things with artificial sweeteners in them are not going to be taxed so people will start drink those and another whole new set of illnesses will crop up.  None of those things are bad for you if not consumed in excess and what right is it of the governments to dictate how much of something we are allowed to eat or drink.  Also who is that tax hurting?  The lower income people who Obama said he is trying to help.  The "it don't effect me so I don't care" attitude is a lot of what is wrong with things now.  What happens when he taxes something that you like to do or consume to pay for his health care plan?  Just because you don't particularly like something or think people shouldn't eat or drink it don't mean is ok to tax it out of existence.  How many of you gripe up a storm about people smoking and then turn around and smoke pot?  One joint is like smoking 5 cigarettes and I don't think people should smoke pot so why don't they make it legal and tax it to the hilt for that health care plan?  Since I don't agree with smoking pot I don't care.  Sell the product for say 15 cents a joint and put a $1 tax on it.  I dislike wine so why don't they raise the tax on that to $2 per bottle or maybe tax that makeup you wear because it's bad for your skin.  Gosh you should be willing to pay more in tax than you pay for the product for some eyeliner or blush.  Gee $5 for the product and $7 for the tax shouldn't be a problem and look at the revenue it would raise.    Sure that might be a bit extreme but my point is where does it stop.  Just like with the cigarette tax and the added tax on tobacco products people then consume less which don't raise the revenue expected and they tax something else to replace it.  It will eventually infringe on something those of you with the "I don't care it don't effect me" attitudes and then see how loud you start screaming.   

[Bo D]

Answer me honestly, please. How much would that cost you personally? I can find three pennies on the parking lot at work every day.

[Exterminator]

Thanks again, me, for bringing up yet another subject that we discussed months ago!

[me]

This tax everything subject needs to be brought up.  Ignoring it will not make it go away.

[Bo D]

Also who is that tax hurting?  The lower income people who Obama said he is trying to help. 

Tax me now or tax me later. If a tax on sugary sodas leads to better health among those lower income people, then maybe I won't have to pay for their health care in the future.

[Exterminator]

Tax me now or tax me later. If a tax on sugary sodas leads to better health among those lower income people, then maybe I won't have to pay for their health care in the future.

Yep.

[me]

Tax me now or tax me later. If a tax on sugary sodas leads to better health among those lower income people, then maybe I won't have to pay for their health care in the future.

They'll just go to diet drinks and then have a whole new set of problems that are caused by the artificial sweeteners and there will be less than expected revenue from the sugary drinks so congress will have to tax something else.  Don't you see a pattern here? 

[Bo D]

They'll just go to diet drinks and then have a whole new set of problems that are caused by the artificial sweeteners and there will be less than expected revenue from the sugary drinks so congress will have to tax something else.  Don't you see a pattern here?

Care to tell us about those health problems caused by artificial sweeteners?

[Henry Hawk]

Tax me now or tax me later. If a tax on sugary sodas leads to better health among those lower income people, then maybe I won't have to pay for their health care in the future.

Where does it stop then.............Does the government decide what is healthy and not healthy and tax anything they feel?.....does this cross the taxation without representation?.....