Date Published: April 18, 2017
Publisher: Public Library of Science
Author(s): Lynn D. Silver, Shu Wen Ng, Suzanne Ryan-Ibarra, Lindsey Smith Taillie, Marta Induni, Donna R. Miles, Jennifer M. Poti, Barry M. Popkin, Claudia Langenberg
Abstract: BackgroundTaxes on sugar-sweetened beverages (SSBs) meant to improve health and raise revenue are being adopted, yet evaluation is scarce. This study examines the association of the first penny per ounce SSB excise tax in the United States, in Berkeley, California, with beverage prices, sales, store revenue/consumer spending, and usual beverage intake.Methods and findingsMethods included comparison of pre-taxation (before 1 January 2015) and first-year post-taxation (1 March 2015–29 February 2016) measures of (1) beverage prices at 26 Berkeley stores; (2) point-of-sale scanner data on 15.5 million checkouts for beverage prices, sales, and store revenue for two supermarket chains covering three Berkeley and six control non-Berkeley large supermarkets in adjacent cities; and (3) a representative telephone survey (17.4% cooperation rate) of 957 adult Berkeley residents.Key hypotheses were that (1) the tax would be passed through to the prices of taxed beverages among the chain stores in which Berkeley implemented the tax in 2015; (2) sales of taxed beverages would decline, and sales of untaxed beverages would rise, in Berkeley stores more than in comparison non-Berkeley stores; (3) consumer spending per transaction (checkout episode) would not increase in Berkeley stores; and (4) self-reported consumption of taxed beverages would decline.Main outcomes and measures included changes in inflation-adjusted prices (cents/ounce), beverage sales (ounces), consumers’ spending measured as store revenue (inflation-adjusted dollars per transaction) in two large chains, and usual beverage intake (grams/day and kilocalories/day).Tax pass-through (changes in the price after imposition of the tax) for SSBs varied in degree and timing by store type and beverage type. Pass-through was complete in large chain supermarkets (+1.07¢/oz, p = 0.001) and small chain supermarkets and chain gas stations (1.31¢/oz, p = 0.004), partial in pharmacies (+0.45¢/oz, p = 0.03), and negative in independent corner stores and independent gas stations (−0.64¢/oz, p = 0.004). Sales-unweighted mean price change from scanner data was +0.67¢/oz (p = 0.00) (sales-weighted, +0.65¢/oz, p = 0.003), with +1.09¢/oz (p < 0.001) for sodas and energy drinks, but a lower change in other categories. Post-tax year 1 scanner data SSB sales (ounces/transaction) in Berkeley stores declined 9.6% (p < 0.001) compared to estimates if the tax were not in place, but rose 6.9% (p < 0.001) for non-Berkeley stores. Sales of untaxed beverages in Berkeley stores rose by 3.5% versus 0.5% (both p < 0.001) for non-Berkeley stores. Overall beverage sales also rose across stores. In Berkeley, sales of water rose by 15.6% (p < 0.001) (exceeding the decline in SSB sales in ounces); untaxed fruit, vegetable, and tea drinks, by 4.37% (p < 0.001); and plain milk, by 0.63% (p = 0.01). Scanner data mean store revenue/consumer spending (dollars per transaction) fell 18¢ less in Berkeley (−$0.36, p < 0.001) than in comparison stores (−$0.54, p < 0.001). Baseline and post-tax Berkeley SSB sales and usual dietary intake were markedly low compared to national levels (at baseline, National Health and Nutrition Examination Survey SSB intake nationally was 131 kcal/d and in Berkeley was 45 kcal/d). Reductions in self-reported mean daily SSB intake in grams (−19.8%, p = 0.49) and in mean per capita SSB caloric intake (−13.3%, p = 0.56) from baseline to post-tax were not statistically significant.Limitations of the study include inability to establish causal links due to observational design, and the absence of health outcomes. Analysis of consumption was limited by the small effect size in relation to high standard error and Berkeley’s low baseline consumption.ConclusionsOne year following implementation of the nation’s first large SSB tax, prices of SSBs increased in many, but not all, settings, SSB sales declined, and sales of untaxed beverages (especially water) and overall study beverages rose in Berkeley; overall consumer spending per transaction in the stores studied did not rise. Price increases for SSBs in two distinct data sources, their timing, and the patterns of change in taxed and untaxed beverage sales suggest that the observed changes may be attributable to the tax. Post-tax self-reported SSB intake did not change significantly compared to baseline. Significant declines in SSB sales, even in this relatively affluent community, accompanied by revenue used for prevention suggest promise for this policy. Evaluation of taxation in jurisdictions with more typical SSB consumption, with controls, is needed to assess broader dietary and potential health impacts.
Partial Text: Sugar-sweetened beverage (SSB) consumption is linked to increased body weight, diabetes, cardiovascular risk factors, and dental caries, amongst other conditions [1,2]. Significant SSB taxes have been proposed and increasingly adopted as part of a comprehensive approach to obesity and diabetes prevention [3–5] with extensive potential health and social benefits [2,5–7]. Over 20 countries have passed strengthened SSB taxes of varying sizes, with a growing emphasis on larger excise taxes [6,8–10].
Three data collection approaches were employed to measure beverage prices, volume sold, store revenue (or, conversely, consumer spending), and beverage intake. Fig 1 illustrates the tax implementation and study data collection timeline. Key elements of analyses were determined prospectively; however, some adjustments were required, particularly as we received and analyzed store scanner data.
A year following SSB tax implementation in Berkeley, California, there was heterogeneous pass-through of Berkeley’s SSB excise tax across store and beverage types. SSB sales in Berkeley fell significantly in two chains of large supermarkets, while sales of untaxed beverages, especially water, and of all beverages increased. From the available data, there was no evidence of higher consumer spending, nor was there a greater reduction in store revenue per transaction in relation to comparison sites. Changes in self-reported SSB intake were not statistically significant.