The Economics of Soda Taxes
Sugary beverages manufactured by companies such as Coca-Cola and Pepsi are colloquially called soda;147 in the United States. Americans consume soda in large quantities. This consumption can be attributed to the fact that soda is easily and cheaply available. The low cost and easy availability are considered to be one of the main reasons why Americans have high rates of obesity and lifestyle diseases such as hypertension, diabetes and even cancer.
The link between high consumption of soda and the increase in health care costs is direct and has been reported by several investigative agencies. It is for this reason that some provinces in America have started levying a soda tax. In simple words, a soda tax is only levied on beverages which have more than a certain specified content of sugar. California was the first state to levy a soda tax in America. However, Philadelphia has one of the steepest rates of this tax.
On the global front, many countries like Denmark, Barbados and the United Kingdom have successfully applied soda taxes. America is amongst the new entrant in the club. Since soda companies such as Coca-Cola and Pepsi are based in the United States, there is a lot of lobbying which is being done in order to repeal these taxes. This has led to a debate breaking out in the United States upon the advantages and disadvantages of a soda tax. In this article, we will have a closer look at these advantages and disadvantages.
Advantages of Soda Tax
The advantages of the soda tax have been listed below.
Disadvantages
The soda companies have been lobbying hard to get the soda taxes repealed. They have been stating many disadvantages of these taxes. Some of the most prominent ones are listed below.
To sum it up, many governments all over the world have woken up to the ill effects of consuming sugary drinks. The soda companies are likely to see more action being taken to prevent excessive consumption of sugar.

Authorship/Referencing - About the Author(s)
The article is Written By Prachi Juneja and Reviewed By Management Study Guide Content Team. MSG Content Team comprises experienced Faculty Member, Professionals and Subject Matter Experts. We are a ISO 2001:2015 Certified Education Provider. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to ManagementStudyGuide.com and the content page url.