Oakland soda tax reduces sugary drink purchases

Purchases of sugar-sweetened beverages (SSBs) dropped 26.8% – compared to similar cities not subject to a tax – between July 2017, when the one-cent-per-ounce tax went into effect, and Dec. 31, 2019.  

The findings ‘signal the potential impact of nationwide legislation’, say the researchers.

Added years of health

Researchers compared sugary drink purchases in Oakland to purchases in nearby Richmond, California and Los Angeles (which do not have sugar taxes).

They compared consumer behavior in these cities in the 30 months before and after the tax went into effect in Oakland on July 1, 2017 (the policy was approved by voters the year before).
 
Researchers then used computer modeling to estimate how reduced SSB purchases affected community health, measuring these via 'quality-adjusted life-years (QALYs)' – a QALY being a year of perfect health.

They also calculated the health care cost savings of preventing or controlling SSB-associated diseases, such as diabetes, heart disease, stroke and gum disease.  
 
Consuming 26.8% fewer SSBs over 10 years added 94 QALYs per 10,000 residents and saved the city more than $100,000 per 10,000 residents in health care costs, the researchers found, with gains expected to increase over a lifetime.

Cost effectiveness compared to other public health policies 

The researchers compared the calculated QALYs to other public health interventions: such as clinical child obesity interventions; a cigarette tax alongside an anti-smoking media campaign; smoke-free workplaces; and traffic-related air pollution measures such as low-emission zones.

“The SSB tax is estimated to be less cost-effective than the cigarette tax plus media campaign but more cost-effective than the smoke-free workplace policy and air pollution measures,” note the researchers.

SSB reductions

Purchases declined in Oakland for all types of SSBs, including sweetened soda by 23.1%, fruit drinks by 30.4%, sports drinks by 42.4% and sweetened teas by 24.4%.  Declines in purchases were similar for individual- and family-sized products, and similar in lower-income and higher-income areas.  

Researchers found no evidence that consumers crossed borders to buy sugary drinks in the nearby untaxed locations, or that they turned to other sweetened snacks instead.

They add that the current study may be an underestimate of the health benefits of the SSB tax, as the investigators did not investigate the positive impacts of the local nutrition and public health programs funded by the tax revenue. 

National potential

“Studies of other US cities have found similar reductions in SSB purchases as this one,” said Dean Schillinger, MD, UCSF professor of medicine, senior author of the study, and a co-chair of the NCCC. “The sustained impact of Oakland’s tax is particularly important. It suggests that, were an SSB tax to be scaled nationally, our country would enjoy better health and lower healthcare costs.” 
 
The path to introduce soda taxes in the US, however, has proved to be a rocky one: although often favored by public health officials they also face resistance from the beverage industry and retailers.

As of 2021, seven US cities had SSB taxes in place in an effort to reduce the risk of diet-sensitive chronic disease and increase government revenue for health promotion. 

California has been a hot battle ground: although Berkeley was the first jurisdiction in the US to introduce a sugar tax, California state legislators prohibited cities and counties from imposing new taxes on SSBs in 2018 (though existing taxes in Oakland, San Francisco, Berkeley and Albany were grandfathered in). 

In 2022 the National Clinical Care Commission (NCCC) – formed by Congress to advise on diabetes policy – recommended​ that legislators pass a national tax on sugar-sweetened beverages.

“These results [from the UC San Francisco study] suggest SSB taxes can meaningfully improve diet and health and generate substantial cost savings over a sustained period of time, all of which support the case for a national tax on SSBs,” said Dean Schillinger, MD, UCSF professor of medicine, senior author of the study, and a co-chair of the NCCC: adding that the study will now provide evidence for legislators and voters alike.

Source: 'Evaluation of the sugar-sweetened beverage tax in Oakland, United States, 2015–2019: A quasi-experimental and cost-effectiveness study' Plos Medicine, ​Published: April 18, 2023 https://doi.org/10.1371/journal.pmed.1004212​