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Oh those sugary drinks

October 8, 2013 - Steve Murch
When you talk about “Sin Tax” in Michigan, you think of cigarettes and alcohol. It's that way around the country, where our indulgences like tobacco and booze are taxed more heavily than other consumption parts of our lives. The goal of these sin taxes is purely financial, and you never hear anyone say anything to the effect of “improving the overall health of the state (or country).”

The Irish government is expected to try and do both as reported by the Dublin Independent, and a10 percent hike in excise duty could be in a budget as proposed by the health minister. The hike would affect soft drinks and other “fizzy” drinks. The tax is two-pronged, one to raise revenue and the other to tackle obesity. It would significantly raise the price of soft drinks. According to the Independent, consumers would pay “a third on top of the pre-tax price.” While we don't think of an extra few coins in a purchase like that, but when put in a lump sum it's significant.

As you can imagine, not everyone likes the idea. Ben Bouckley, writing for BeverageDaily.com, writes that Food and Drink Industry Ireland says the tax could threaten an economic recovery in Ireland. He writes that FDII calls it a discriminatory tax and the Irish food and drink industry is worth over 24 billion euros.

While Alpena and Michigan aren't what I would call snapshots, they still offer a glimpse at the effects of sin taxes, or lack thereof. Michigan and Alpena are above average in cigarette consumption, so clearly a high sin tax hasn't slowed that down. And with smoking, we never really know the final effects until it's too late.

Would a sin tax work on soft drinks? It certainly would raise revenue, as only fountain drinks — those found at restaurants and party stores/gas stations — are taxed now. Soft drinks purchased in bottles aren't taxed.

As for the health factor, there might be a modest — temporary — drop happen. But some habits are hard to break, and many people would return to buying them. I have serious reservations there would be any kind of change in health simply by adding a tax to fizzy drinks. If people want to drink them, they'll drink them. Just like people who want to smoke do it, sin tax be damned.

 
 

Article Comments

(1)

amos57usa

Oct-22-13 7:34 AM

First we have to demonize pop. No pop drinking at college inside or out. No pop drinking at hospital inside or out. No pop drinking in resturants or bars. Everyone must give pop drinkers dirty looks and call them dirty poppers, carbonization cravers and fizz addicts.

 
 

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