The beverage industry has achieved a decisive victory this week in its fight against soda tax, as California legislators decided to ban future local taxes on sugary drinks.
The state had been a hotbed for the soda-tax movement, passing laws designed to reduce soda drinking in four jurisdictions. But after the ban on express trains, which was introduced on June 23 and signed legally five days later, no new taxes on food or drink can be imposed in the state until 2031 at the earliest.
The law represents a significant, if long-awaited, struggle between the soda-makers of the nation, who have previously fought, city by city, spending millions of dollars. Soda companies say the nationwide bans protect jobs and businesses more efficiently that could be violated by local tax laws.
But public health advocates argue that governmental reservations undermine voters' will and health, pointing out that similar tactics have been adopted by tobacco companies and fast food chains, ranging from cigarette taxes to Ward off labels.
Now supporters of the Soda Control Movement are looking for other opportunities in California – and supporting similar struggles across the country.
There is a fear that California, as is the case in the nation, "said Sabrina Adler, a senior lawyer at ChangeLab Solutions, developed public health policies." This could be the beginning of further paternalism
Supporters say the tactical change of soda makers was not unexpected, even though the speed of the California ban has surprised many, and California has long been at the forefront of the soda-tax movement, which limits the consumption of sugary drinks and at the same time increase the revenues of local governments.
Soda is a major source of calories and sugars in the American diet and in urban tax breaks – as was the case in Berkeley, California, which became public in 2014 – see consumption drop, and according to the American Heart Association, eight cities now have soda taxes on them f the books, four of them in California, and a number of other cities in the state were preparing ballot measures.
But while California's existing taxes remain under the ban this week, others in the pipeline can not continue. This will protect consumers and retailers from unexpected price increases, argues the American Beverage Association, the soft drinks retailer.
Business in other cities that outperformed soda taxes suffered a dramatic drop in sales and risked jobs, ABA said. The group has also argued that soda taxes affect disproportionately low income buyers who spend a larger portion of their income on food and drink.
"Our goal is to help working-class families by preventing unfair increases in their grocery bills," said William Dermody, ABA Vice President of Policy, in a statement. "At the same time, we're working with public health and government officials to help Californians reduce sugar consumption in ways that do not cost jobs or harm small businesses that are so important to local communities."
Such decisions should be left to local communities, argues Carter Headrick, director of state and local obesity policy at the American Heart Association, who opposed the ban. Cities and communities are best placed to assess whether a tax will improve health and increase revenue in their jurisdiction, he said, and the experience of most cities has been positive. Only two states, Michigan and Arizona, have already enforced this type of preventive ban and cities have not pursued an active tax policy in either state.
Critics have also criticized the introduction of the ban. After advocating another, far wider tax measure, ABA and other business groups agreed to ban soda tax through a last-minute deal with state legislatures and unions.
Many lawmakers – including Assembly spokesman Anthony Rendon – described the ban as a means of killing this referendum initiative, which would have made it much harder for cities and counties to levy taxes on anything, let alone soda.
"We are disappointed with the vote and we are disappointed with the governor who signed the bill," said Headrick. "But we are particularly disappointed that ABA has resorted to an extortionary measure, forcing a right of first refusal by the legislature."
However, some advocates see a silver lining in this escalation. Scaffolding Californian cities may now be more open to other anti-soda measures, such as warnings and child meals, Adler said. There is also hope that lawmakers, many of whom have stated in statements that they have been forced to approve the ban, will now support a nationwide soda tax – which is not prohibited by this legislation.
And outside of California, supporters will continue to push for city and county soda taxes, said Margo Wootan, the vice president of nutrition at the Center for Science in the Public Interest. Public health advocates are not strangers to foreigners like California, Wootan, or similar bans now pending in Pennsylvania, Oregon, or Washington.
The strategy is closely linked to tobacco companies that have stopped cigarette smoking and prohibition smoking in public places. More recently, Wootan has clashed with restaurant groups that wanted to ban the labeling of menus at the state level.
Today, she stresses, such prohibitions are worrying: in early May, the Food and Drug Administration began to oblige all chain restaurants to burn calories, after years of pressure from health groups.
"We are used to working on these issues for decades," Wootan said. "The industry hopes that this will be a major obstacle to the soda-tax movement, but this is a temporary gain for them."
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