During the last legislative session, a group called Alliance for a Healthier Vermont pushed for an excise tax on sugar-sweetened beverages, like soda, that would raise an estimated $30 million for Vermont.
So some might call it a victory that lawmakers instead decided to apply the state's 6 percent sales tax to soda and candy. But advocates aren't convinced, and plan to continue to push for the excise tax.
"The obesity crisis is very significant, even in Vermont which is often thought of as the most healthy state in the nation," says Tina Zuk, co-chair of the alliance, a coalition of groups formed around the goal of the excise tax and using the revenue to address obesity and provide greater access to health care for low-income Vermonters. It's made up of public health groups, hospital organizations, businesses and farms.
"We're kind of the best of the worst when it comes to obesity. We're spending about $202 million on treating the diseases caused by obesity annually, and that's just adults. That doesn't count the costs associated with kids. But more important than reducing the spending is to try to get the diseases reduced, and also to provide funding so we can prevent obesity on-going," Zuk says.
Zuk says the excise tax is a much better tool for changing behavior. The sales tax is a percentage of the overall price of the product, and it's only shown on the receipt after the sale, so it does nothing to influence purchasing decisions.
"We're spending about $202 million on treating the diseases caused by obesity annually, and that's just adults. That doesn't count the costs associated with kids." -Tina Zuk, Alliance for a Healthier Vermont co-chair
The excise tax is imposed on the distributor and is already on the product when it arrives on the shelf. Zuk said that means people can make the decision based on the price when they see it in the store, and it's taxed on the volume of the product, not on the price. Zuk said to purchase two 12-packs of soda cans, on sale at a local store, for two for $5 would cost an extra 30 cents with a sales tax. A per-ounce excise tax on those same packages would be $5.70.
"That would likely deter you from buying so much. For those people who drink the two liters a couple times a day, and stock up on cases, the excise tax is front and center in the price and you can make that decision based on the price," Zuk says. "We want people to drink these sugary drinks as the treat they were intended to, not constantly throughout the day. The consumption of these drinks has increased 500 percent over the last 50 years and we want to get that down."
"We want people to drink these sugary drinks as the treat they were intended to, not constantly throughout the day. The consumption of these drinks has increased 500 percent over the last 50 years and we want to get that down." - Tina Zuk
Groups that opposed the excise tax, like the Vermont Retail and Grocers Association, said an excise tax wouldn't work because some retailers would choose not to raise the price of these beverages, but instead would spread the cost of the tax to many other products in their store. Zuk said there's no evidence that would happen, and those arguments were made with the cigarette excise tax and that never happened, instead the price of cigarettes increased.
"When there's a health crisis that impacts Vermonters and then it costs other Vermonters, it makes sense for the government to step in," Zuk said, citing the examples of seat belts and smoking laws. The alliance plans to continue to make the case for the excise tax in future legislative sessions.
