Is it time to tax bads instead of goods?

Every year on April 15th, Americans are reminded of a passion that literally helped found our nation: our collective distaste for taxes. But with our government so clearly in need of funds to address major infrastructure, education, health, social, and environmental concerns — I am not opposing taxes, but rather joining a growing group of people wondering if we are just taxing the wrong things.

Why do we tax the things we like and want more of: income, profits, sales of products, etc.? Shouldn’t we instead be taxing things we don’t like and want to incentivize people to reduce: pollution, carbon emissions, inefficient use of resources, etc.?

As we have been studying food recently, what about taxing junk food? Or ingredients of concern like sugar and high fructose corn syrup in food products?


That is exactly what Dr. Kelly Brownell and Dr. Thomas Frieden proposed in a recent article in the New England Journal of Medicine.

Brownell and Frieden assert:

Sugar-sweetened beverages (soda sweetened with sugar, corn syrup, or other caloric sweeteners and other carbonated and uncarbonated drinks, such as sports and energy drinks) may be the single largest driver of the obesity epidemic. A recent meta-analysis found that the intake of sugared beverages is associated with increased body weight, poor nutrition, and displacement of more healthful beverages; increasing consumption increases risk for obesity and diabetes; the strongest effects are seen in studies with the best methods (e.g., longitudinal and interventional vs. correlational studies); and interventional studies show that reduced intake of soft drinks improves health. [1]

So why not tax sugar-sweetened beverages? Brownell and Frieden explain:

a one-penny-per-ounce excise tax on sugared beverages… would be expected to reduce consumption by 13% — about two servings per week per person. Even if one quarter of the calories consumed from sugared beverages are replaced by other food, the decrease in consumption would lead to an estimated reduction of 8000 calories per person per year — slightly more than 2 lb each year for the average person. Such a reduction in calorie consumption would be expected to substantially reduce the risk of obesity and diabetes and may also reduce the risk of heart disease and other conditions.

There will of course be many objections to this kind of tax: is it regressive? is it intrusive? will it work? Brownell and Frieden respond to these critiques, and present significant food for thought on tax day.

Happy April 15th!

About Dara O'Rourke

Associate Professor at UC Berkeley and Co-Founder of GoodGuide.
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3 Responses to Is it time to tax bads instead of goods?

  1. Melissa Miranda says:

    I propose a tax on high fructose corn syrup- that should make a nice dent into the obesity epidemic. Getting it past the corn lobby is something else altogether though…

  2. Starfevre says:

    Why not just remove the subsidies on corn? That would eliminate a lot of HFCS in things where it is totally unnecessary. Not all sweeteners are created equal.

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