Study: Seattle sugary beverage tax led to 30.5% drop in sales

Feb 19, 2020, 3:34 PM | Updated: 3:48 pm

sugary drink tax, soda tax...



A new study on the passing of Seattle’s sugary beverage tax revealed perhaps unsurprising results: Sales of the beverages significantly dropped as a result of the tax, 30.5 percent in the months after it came into effect.

Seattle’s tax of 1.75 cents per fluid ounce of sugary beverages took effect in January 2018, and is charged to distributors of sugar-sweetened beverages. The soda tax was expected to bring in about $15 million in its first year. Instead, it produced more than $21 million in 2018 – about $7 million more than expected.

Study: 97 percent of Seattle soda tax passed on to consumers

The study was conducted by University of Illinois at Chicago researchers, who compared sales periods sales from February through September 2018 to the same time period in 2016 and 2017, and used Nielsen retail-scanner data from numerous types of stores where such drinks are available, reports The Seattle Times. As to whether the taxes are pushing consumers elsewhere to purchase sugary drinks, the study also found that sales in border areas within two miles of Seattle only dropped slightly.

The city council voted in July to approve restrictions on Sweetened Beverage Tax revenues. The money was initially slated for programs aimed at improving access to healthy foods. But after taking in far more funds than expected — nearly $6 million — some of that excess money has been used for other purposes, such as social services.

Council votes to overturn Mayor Durkan’s veto of soda tax restrictions

Of the beverages being sold, family-sized beverage dropped more than sales of individual sizes (31 percent versus 10 percent), with soda seeing the biggest decrease of all sugary beverages at a 29 percent drop.

As a contrast, researchers looked at sales in Portland, where no such tax exists, and found that sales of sugary beverages dropped only 10.5 percent.

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Study: Seattle sugary beverage tax led to 30.5% drop in sales