A simple tax could be a big tool in ending America's obesity epidemic.
Adding a 20-percent tax on sugar would cut Americans' total caloric intake by 18 percent and reduce sugar consumption by more than 16 percent, according to a new study from the National Bureau of Economic Research.
Economists Matthew Harding of Stanford and Michael Lovenheim of Cornell analyzed the details of more than 123 million food purchases made in the U.S. between 2002 and 2007 and tried to simulate the effects of various taxes on American buying habits. They found that the most effective strategy for improving public health would be to implement a broad-based tax on sugar. Taxes on fat and salt would help, too, cutting total calories by an estimated 19 percent and 10 percent, respectively, according to the study.
Taxing a broad category of nutrients, like sugar or salt, is more effective than taxing a specific product, like soda or potato chips, the study noted. That's because Americans find ways around product taxes by substituting other unhealthy items for the taxed product -- think of a soda tax encouraging more people to buy sugary sports drinks or candy. The goal, according to the study's authors, should be to design taxes that are hard for consumers to avoid.
Sweet-tooths and the food industry may balk at the idea, but when you think about it, we already impose some hefty taxes on harmful products like alcohol and tobacco.
And the danger is huge: Obesity kills more than 2.8 million people every year, according to the World Health Organization. Today, two-thirds of Americans are overweight, and 36 percent are obese.
America's obesity crisis even indirectly affects health nuts: Obesity and its related health impacts cost American taxpayers more than $147 billion (yes, billion) per year, according to the study.
So taxing sugar could save billions of dollars and millions of lives. Wouldn't that be sweet?