Philly’s Sugary Beverage Sales Drop 38% After Tax

Dentistry Today


One year after Philadelphia passed its beverage tax, sales of sugary and artificially sweetened beverages dropped by 38% in chain food retailers, according to Penn Medicine. Researchers there say the decline translates to almost a billion fewer ounces of sugary or artificially sweetened beverages, or about 83 million cans of soda, purchased in the Philadelphia area.

The findings provide more evidence to suggest that beverage taxes can help reduce the consumption of sugary drinks, which are linked to tooth decay as well as obesity and its related noncommunicable diseases such as type II diabetes, the researchers say.

One January 1, 2017, Philadelphia became the second city in the United States to implement a tax on the distribution of sugary and artificially sweetened beverages. The goal of the 1.5 cent per ounce tax was to generate revenue to support universal pre-K, community schools, and improvements to parks and recreation centers, with the potential side benefit of curbing the consumption of unhealthy drinks. 

“Taxing sugar-sweetened beverages is one of the most effective policy strategies to reduce the purchase of these unhealthy drinks. It is a public health no-brainer and a policy win-win,” said first author Christina A. Roberto, PhD, assistant professor of medical ethics and health policy at the Perelman School of Medicine at the University of Pennsylvania. 

“It’s likely to improve the long-term health of Philadelphians, while generating revenue for education programs in the city of Philadelphia,” said Roberto.

According to Philadelphia’s Community Health Assessment, 32% of adults and 18% of teens in the city consume one or more sugar-sweetened beverages each day. Beverage taxes have now been passed in seven cities in the United States and are being considered at the state level in Connecticut and Colorado. The first city to implement a tax, Berkeley, California, saw sales drop by 10% and consumption fall by 52% among its low-income residents. 

Penn’s researchers analyzed store-wide beverage price and sales data one year before and one year after the tax was implemented at 291 chain retailers. Stores included supermarkets, mass merchandisers, and pharmacies, which together represent the largest sources of sugary beverage sales.

The study did not include restaurants or independent stores. But it did include stores within the city limits and those just outside to understand how many taxed drinks were being purchased across city lines just to avoid the tax. Furthermore, its results were compared to Baltimore, which has no beverage tax.

Data was obtained from Information Resources Inc, which tracks and compiles sales data from US retailers. The study also found that the cost of sugary and artificially sweetened drinks increased by 0.65, 0.87, and 1.56 cents per ounce at supermarkets, mass merchandisers, and pharmacies, respectively. 

Between January 2016 and December 2017, there was a 59% reduction in taxed beverage sales at supermarkets, a 40% reduction at mass merchandisers, and a 13% reduction at pharmacies. Overall, people purchased nearly 1.3 billion fewer ounces after the tax, which is more than a 50% decrease in total volume of ounces.

After accounting for some consumers crossing city lines to buy drinks, overall sales of taxed beverages dropped 38% among chain food retailers in the area. In a separate study, the researchers found that filings of unemployment claims in Philadelphia industries potentially affected by the tax did not change in the year after the tax was implemented. 

“Philadelphia’s tax on sweetened drinks led to a huge reduction in sales of these unhealthy drinks one year after it was implemented and generated revenue for thousands of pre-K slots. That’s great news for the well-being of the people of Philly,” said Roberto.

The study was published by JAMA.

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