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Thursday, September 2, 2010
Potential tax proposal leaves sour taste in mouths of some

Thursday, November 5, 2009


Senate is considering a tax on carbonated beverages and other sweetened drinks. Marcin Rutkowski/The Daily

As leaders in Washington debate whether to put a 1 cent per ounce tax on soft drinks and other sugary beverages, OU students and faculty have different perspectives on the tax.

The tax is intended to help reduce the rates of diet-related diseases and health care costs and the U.S. could raise $14.9 billion in the first year and $150 billion over a decade, according to an article in the New England Journal of Medicine.

“Personally, I am not in favor of identifying one particular beverage or food as the problem,” said Sandra Richardson, assistant professor in the OU College of Allied Sciences. “I am very concerned with health care and the cost of health care. I am just unsure how we can single out one calorie source and deem it taxable at a higher rate.”

Richardson said she would rather provide the public with nutritional information and give them the right to choose for themselves.

“In general, I tend to support revenue raising mechanisms that tax a very broad base over the use of narrowly defined excise taxes,” Gregory Burge, assistant professor in the OU Department of Economics, stated in an e-mail. “However, there is a solid economic rationale for taxing activities that generate negative externalities.”

Having said that, individual freedoms are very important to citizens, he stated.

“Many individuals drink soda or eat fatty foods, while still retaining very healthy lifestyles,” Burge stated. “Even if the consumption of soft drinks does create a negative externality for taxpayers through higher health care costs, taxing soft drinks may have harmful effects on the distribution of income.”

A soft drink tax would be highly regressive, and this point should not be taken lightly, he stated.

“How I understand the legislation is that the entire motivation of the tax itself is to remain as budget neutral as possible and stop the bleeding national deficit. That is agreeable across any partisan shaping,” said Buzz Becker, economics and political science junior.

Becker said he believes the pivotal point of the proposal has to deal with what one believes is the ideal social contract. Meaning, [whether] it is preferable to take money from all to afford the health care of some,” he said.

“I would say that the dramatic effects of health care-induced bankruptcy are more volatile in a macro sense than a more expensive Mountain Dew,” Becker said.

According to the U.S. Centers for Disease Control and Prevention Web site, the rate of obesity, which is a major cause of diabetes, stroke and heart attack, has more than doubled in the last 30 years.

Additionally, soft drinks and other sugar-sweetened drinks have been linked to more calories eaten, leading to more pounds, the Web site stated.

Some students and faculty said the taxation of soft drinks and other sugar-sweetened drinks that lead to obesity, diabetes and other ailments would lower consumption, reduce health problems and save medical costs.

“Given that Medicare and Medicaid cause a large fraction of health care spending to come from public funds, it is not difficult to argue that at least a small portion of the costs of poor eating and drinking habits are borne collectively by taxpayers,” Burge said. “This could be used as an argument to justify the use of a tax on soft drinks or any other unhealthy items.”

Comments

does the first sentence of this story make sense to anyone else?

Posted by anonymous / OUguy on November 5, 2009 at 12:45 a.m.

I say tax away. Soda is a luxury food item and doesn't have any beneficial nutrients in it for your health. If you don't like it, drink tap water. It's a lot cheaper and much better for you.

Posted by anonymous / Cambrian on November 5, 2009 at 10:06 a.m.

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