[sailormoon]

The whole point of the tax is to discourage consumption. If Ms W. Queen can't afford the tax to feed concentrated diabetes inducer to her little angels, then good! Success!

Non-diet soda is almost as bad as cigarettes and we should tax the freaking hell out of it.

[profgubler]

It depends on how high the tax is and how elastic the demand for soda is. If the soda tax isn't high enough than people will continue purchasing and pay the tax. An extra couple of cents on a can of soda likely won't change consumption and will only hurt the poor more.

I am guessing that the elasticity of soda is a lot higher than cigarettes so it would take a lot smaller of a tax to change behavior. And to be honest most sin taxes are really not there to change consumption they are their to make money because they know people will pay for it.

Look at the recent increase in the cigarette tax that is supposed to pay for S-Chip. They don't want smokers to smoke less, because that would reduce revenue and prevent them from paying for the program. They set the taxes at a level that will maximize revenue and not greatly affect consumption.

Update: I just read here http://seekingalpha.com/instablog/137417-wall-street-strateg... that the new england journal of medicine says that the price elasticity of demand for soda is -.8. What that means is that demand for soda is inelastic. This means that soda is just like any other sin tax. It is not meant to actually reduce consumption. It is meant to create revenue. Yes some people will consume less, but the vast majority will not consume less. So I hate to say it, but this isn't a tax for the health of the American public, but a tax for the wallet of government.

[yummyfajitas]

There are two purposes to a sin tax: reducing consumption or compensating society for the loss caused by the sin. A perfect sin tax is set at such a level that no one needs to care which one occurs.

If a soda drinker inflicts $0.03 / soda on society, the perfect sin tax would also be $0.03. In such a regime, I don't care how much soda you drink since you are paying for your own health care via the sin tax.

[profgubler]

Yes, the externality is being paid for in that instance, which depending on your viewpoint is a good thing. But if that is the case that we only want to pay for your stupidity in drinking soda, than they shouldn't be pitching something that is for the health of the people, because it isn't.

Which brings us to the entire problem of a government run health care program. Anything deemed bad for us will be taxed and pitched as the fact that it is for the health of the people instead of to cover the costs of your choices on society.

And yes, I realize that a person who drinks a soda in a free market healthcare system still affects the cost of my insurance, however it is to a far less extent than when I am the one paying for my neighbors drink.

[radu_floricica]

I like how you're so optimistic that you imagine somebody actually checked the elasticity when considering this tax.

I'd have guessed a big enough tax might make natural juice more competitive. I don't think you have many people who'd prefer Fanta over a natural, carbonated juice - at the same price.

[araneae]

  Non-diet soda is almost as bad as cigarettes

Now that, my friend, is hyperbole.

You are 1.6 times more likely to become obese if you drink soda.

You are 10-20 times more likely to get lung cancer if you smoke cigarettes (CDC website)

I don't know anyone who would think an order of magnitude is "almost."

[yummyfajitas]

100 kcal/soda x 1 soda/day x 35 days = 1lb of body weight.

I'm currently slightly overweight at 220lb (6'4", BMI 26), and my current lifestyle exactly maintains my weight (varies from 220-225). If I drink 1 8 oz soda/day (I currently drink none), I would become obese in less than 3 years.

Granted, if I also eat brownies, soda won't be solely responsible. Doesn't mean that soda didn't contribute.

[count]

You can get lung replacements/transplants, you can't replace your entire torso with a skinnier one. (It's a joke...)

[pbhjpbhj]

>Non-diet soda is almost as bad as cigarettes and we should tax the freaking hell out of it.

Actually diet soda (artificially sweetened and artificially flavoured carbonated water) is shown in studies to be unhealthy too:

"Although these observational data cannot establish causality, consumption of diet soda at least daily was associated with significantly greater risks of select incident metabolic syndrome components and type 2 diabetes." [http://care.diabetesjournals.org/content/32/4/688.abstract, "Diet Soda Intake and Risk of Incident Metabolic Syndrome and Type 2 Diabetes in the Multi-Ethnic Study of Atherosclerosis (MESA)"]

and more recently has been fingered as a cause of increased obesity.

Google "diet soda obesity".

[Semiapies]

RTFA: it largely isn't expected to work.

See whether you can find any example in the wild of a "sin tax" that actually reduces consumption of what it targets.