Taxing soft drinks

POSTED: 06/21/16 12:45 PM

Though our government may not be shooting for higher taxes, as Finance Minister Richard Gibson said on Friday during the tax summit at the Westin, there may be one levy that makes sense: a tax on soft drinks that contain sugar or artificial sweeteners. Philadelphia is the first large city on the United States to implement the measure.

Okay, some would say, from there we will be quickly at that old story about taxing alcohol and tobacco. But so what? It is only fair to look at the social and economic impacts of the use of sugary soft drinks, of smoking like a Turk and of drinking like Paul Gascoigne.

Philadelphia approved the law last week with 13 against 4 votes. The tax of 1.5 penny per ounce (28.5 gram) is for soft drinks to which sugars or artificial sweeteners have been added. The price of a can of soda would go up by around 15 cents in 2017 when the measure takes effect.

Philadelphia made two earlier attempts to introduce the tax, but it did not find a majority for it. This time the municipal council approved the measure after Mayor Jim Kenney had emphasized the potential fiscal advantages, rather than focusing on the public health aspects.

“Americans do not like to be told what is healthy for them,” Kenney explained his strategy. That shows: 68 percent of the city’s adult citizens and 41 percent of its children suffer from obesity.

The measure is yet another setback form the soft drink industry that is already under fire from consumers with healthcare concerns. Soft drink companies spent millions of dollars in Philadelphia on a campaign against the measure. The American Beverage Association has labeled the measure “discriminating and highly unpopular.” The organization goes to court in an attempt to nullify the legislation.

Here we have another clear example of commercial interests versus public health concerns, Obesity is no stranger to St. Maarten – or to the former Netherlands Antilles, for that matter – and politicians have talked about the issue several times in the past. They have however never taken the obvious steps to clamp down on obesity by cooking up a measure similar to the one Philidelphia has now put in place.

Is a tax on sweetened soft drinks the beginning of a whole new series of tax measures? We cannot see into the future, but it makes sense to us.

The bottom line is that too many people refuse to take responsibility for their own health. They figure that they are covered by insurance and once their bad habits cause health problems, the doctor will take care of them. Never mind that health care costs – not only in St. Maarten, but all over the world – are completely out of control.

It would however be rather cynical to look at these issues from a purely financial point of view. The onus ought to be on the desire to guarantee citizens a happy and healthy life. After all, if our toddlers want to put their little fingers into an electrical outlet we tell them off as well, knowing darn well the consequences if they don’t listen.

Imbibing sweetened soft drinks, partying hard on alcohol and smoking like there is no tomorrow have one thing in common: their effects are not immediately apparent. It could take years before someone comes to the realization that, after all, he or she should have made better and healthier choices.

If the measure of taxing unhealthy choices comes across as patronizing, we’d like to point out that people who do not want this, should also be held fully responsible for the financial consequences of their behavior. In other words: (much) higher insurance premiums for smokers, heavy drinkers and the lovers of Coca Cola.

And yes, tax that stuff. The real aficionados of a sweetened soft drink who are prepared to pay, say, $1,25 for a can, will also pay $1.40 if that is required to get their fix.

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