In a recent, interesting article penned by William Neuman (published on September 16, 2009), reporting on the recent debates among a variety of interested parties concerning ‘Proposed Tax on Sugary Beverages’, he in turn expresses an equally varied range of views regarding – as the title of this article suggests – this new and controversial proposal to tax sugary beverages.
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Clearly, this was an issue that was always going to court controversy and divide opinion. As Neumann quite rightly states in the article, this division emerges from and continues to come from the predictable sources. These being, the leading manufacturers and distributors of soft drinks, forming a vanguard of natural opposition to the proposed tax.
While on the other hand, a number of health lobbies and groups pledge their support for the proposed tax. Not least included among these, the support of the current United States administration – and (perhaps most importantly), the charismatic President (Obama’s) view that the proposal is ‘worth considering’ – counted among them, in broadly supporting a measure which aims at tackling obesity among the general populace.
In between these two polarizing opinions, exist the skeptics, that is, those for whom, the measure will prove beyond legislation and above all (to quote Neumann), ‘point to political obstacles and question how much of an impact it would really have on consumers.’
Not surprisingly, the chief executive of Coca-Cola, Muhtar Kent, calls the proposed tax (which would not apply to sugar-free soft drinks but include many juices and iced teas), ‘outrageous’.
However, for those who do not accept this, nor find themselves in agreement with the arguments forwarded by skeptics, the estimated economic advantages and benefits that even a proposed one penny per ounce tax on sugary beverages would generate, no doubt provides a lucrative extra added incentive.
For those representing this side of the argument, a not inconsiderable political body which includes the ‘New York City health commissioner, Thomas Farley, and Joseph W. Thompson, Arkansas surgeon general’, a figure of ‘$14.9 billion in its first year’, understandably counts as good cause for considering such a tax not merely viable but hugely desirable.
Further to this, the additional revenue, they suggest, could be used to support more health care initiatives in the way of helping ensure greater efforts are made towards combating the growing problem of obesity.
For this commentator, at least, as one who supports and recognizes the importance attached to the fight against obesity in the United States, these latter pro-tax arguments not only stand up, but far surpass those presented by those currently stood as opposed to it.
That they also cite for these and other supporting claims (including the likelihood of it having a positive impact in reducing ‘health risks among many Americans’), on evidence submitted in a recent research article written in the respected journal The New England Journal of Medicine, only adds greater evidence in support of introducing the tax.
In terms of popularity, and really, speaking in terms of consumerism, this approach seems a far better bet for securing future funding for a much-needed pro-health initiative that seems assuredly to gain the full support of the government.
This, in turn, will, predictably cause a ‘for-now’ much-opposed soft drinks conglomerate to rethink their position.
They might only need to look as at how other companies such as McDonalds in recent years have successfully capitalized on the need to acknowledge and inform consumers of the high sugar (as well as other less healthy ingredients), contents found in their products.
In this sense too, manufacturers of sugary beverages’, as pointed out above, are also already well-schooled in promoting non-sugary beverages. Often, these sugar-free saccharin alternatives, requiring simply adding the word ‘diet’ to what are for many consumers already household beverage names.
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As support in America grows for the healthier lifestyle and a healthier nation, surely this is to be preferred over the recently proposed by Montana Senator Max Baucus, tax-hike on what for many amounts to having no choice in the matter – ‘an array of taxes and fees on high-end group insurance plans, drug, and medical device makers’.
This type of increase, at least, in this economist’s view, imposes lesser choice on people making crucial decisions regarding which plan, medicine or medical device better suits their needs.
The consequences of a proposed tax on sugary beverages however, as argued here, impacts in no similarly (and possibly life-threatening), way.
For instance, argued here, though it might influence as to which of the two – sugary or non-sugary beverages – consumers choose to drink on a regular basis, the proposed tax would not appear at least in the eyes of today’s newly ‘much-better informed consumers’ amount to a huge price-hike on the former, and just as importantly, would not interfere with people making informed choices when deciding to drink one beverage or the other.
That soft drinks companies do not accept their products as bearing any responsibility for adding to the nation’s growing obesity, this view, does not fit the spirit of the newly ‘switched-on’, health-conscious consumerist age, we live in.
Indeed, arguably, this factor too, will eventually come to influence an at present opposed to this tax, Congress majority. in ne that with a little imagination from soft drink manufacturers need not necessarily mean any loss overall in profits, nor consign them to occupying a place among the rapidly expanding list of companies, foods and drinks, the American public today, sees as responsible for its no less nation-wide expanding waistline.
Neuman, William, ‘Proposed Tax on Sugary Beverages Debated,’ New York Times 16 September 2009.