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The “war on sugar” is about to hit a new level

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Illinois

On Oct 11, World Obesity Day, WHO upped the ante in its fight against sugar. First, it called for governments to introduce subsidies for fruits and vegetables and taxation of unhealthy foods, with a particular target on sugary drinks. The new WHO recommendations are based on global expert opinion and 11 systematic reviews of the effectiveness of fiscal interventions for improving diets and preventing non-communicable diseases (NCDs).

That action helped spark what some are calling a “war on sugar.” And it has led to Cook County’s penny per ounce sugary beverage tax…

“The amount that we spend in the Cook County Hospital and Health Systems is approximately $200 million to treat heart disease, kidney disease, diabetes and others,” said Dr. Javette Orgain, a member of the American Academy of Family Physicians. “From our perspective, it’s worth the fight to add a tax to sugary beverages to reduce the consumption.”

* The Senate’s “grand compromise” also includes a tax on sugary drinks, although Arkansas led the way long ago…

The Southern state has levied taxes since 1983 on soft drinks and syrups and related products ranging from 0.16 to 1.56 cents per ounce.

With the increased momentum from local governments who’ve lately been passing their own taxes, a new statewide tax in a big state like Illinois could lead to even bigger states like California passing their own.

So, expect a huge pushback on this aspect of the Senate package.

* From Pepsi MidAmerica…

Overnight, the retail price for a two-liter soft drink in Illinois could jump nearly 70 cents, a 12 pack of refreshments could increase $1.44, and a 12 pack of tea would add an additional $2.04 if Illinois lawmakers have their way. Bills are being introduced in the Illinois House and Senate to impose a penny-per-ounce surcharge to consumers on caloric sweetened liquid refreshments. Opposition to the tax comes from every corner of the state and includes consumers, civic organizations, small business owners, and the labor force. Trevor Borowiak, President Borowiak’s IGA stated “The burden of this regressive tax on liquid refreshments will affect Illinois families who are already paying too much of their income on taxes. Consumers do not need the government telling them what to put in their shopping cart.”

Senate Bill SB0009 imposes a tax on Liquid Refreshments, Teas, and Juices which are already subject to a 6.25 percent tax compared to ‘qualifying food and drugs,’ which are taxed at one percent. The legislation would raise the cost of soda, juice drinks, sports drinks, teas, and more. “It’s a senseless tax since it will drive down the volume upon which it depends to raise revenue,” said John Rains, Pepsi MidAmerica Executive VP & General Manager. “Not only will this affect the liquid refreshment companies, but as it depresses sales, it will pose a significant impact on convenience stores, restaurants, grocery, schools; basically anyone serving liquid refreshments.”

The Illinois liquid refreshment, tea, and juice industry currently provides 114,124 jobs at 55 bottling and distribution facilities throughout Illinois. Together these companies now pay $6.2 billion in annual wages. They generate a yearly economic impact in Illinois topping $21 billion according to the Illinois Coalition against Beverage Taxes.

* The Illinois Manufacturers Association has voiced its disapproval and so has IRMA…

Also unpopular, at least with the Illinois Retail Merchants Association, is a proposed penny-an-ounce tax on sugary drinks, modeled on a levy recently adopted by Cook County.

The tax is “regressive” and “unreliable” as a source of money, said IRME President and CEO Rob Karr. “It goes in the exact opposite direction of where we should be: a broad-based, low-rate system.”

Thoughts?

* Related…

* Big Sugar’s Secret Ally? Nutritionists

* How Much Harm Can Sugar Do?

* Coca-Cola Working to Make War on Sugar a Profitable Venture: To respond to consumers’ growing aversion to the sweetener, the company is offering smaller bottles and cans — essentially getting customers to pay more for less product. It’s also creating new brands and reformulating existing drinks to cut sugar. Coca-Cola says the shift will actually increase sales, and the company’s third-quarter results on Wednesday backed up that confidence. Revenue beat analysts’ estimates, helped by water and sports drinks as well as the higher-margin small packages.

* ‘War on sugar’ fosters change for global candy industry: The “war on sugar” has dented demand of sweet snacks as 47% of global consumers look for foods with limited or no added sugar, according to a recent survey by Euromonitor.

* Choosing Sides in War on Sugar: The people at candy-maker Mars Inc. have something to tell you: Stop eating so much sugar! According to the Wall Street Journal, the manufacturer of M&Ms, Snickers and Twix has thrown its weight behind a U.S. Food and Drug Administration push to include measures of added sugar on food labels. Non-candy food manufacturers such as Campbell Soup Co. are opposed to the change, but Mars figures that people already know their candy bars are full of sugar.

posted by Rich Miller
Friday, Jan 13, 17 @ 12:25 pm

Comments

Sugar is the new tobacco. The science is compelling.

Comment by 47th Ward Friday, Jan 13, 17 @ 12:27 pm
How much do other states tax for sugary drinks?

Comment by Anonymous Friday, Jan 13, 17 @ 12:35 pm
What about the 4 Milk Duds I just ate?

/s

Comment by WhoKnew Friday, Jan 13, 17 @ 12:36 pm
It seems they are also looking at taxing diet drinks (at least in Cook county from what I understand)

Comment by Oneman Friday, Jan 13, 17 @ 12:37 pm
===How much do other states tax for sugary drinks? ===

Sigh.

Try re-reading the post.

Comment by Rich Miller Friday, Jan 13, 17 @ 12:39 pm
But this tax doesn’t help. I had the same reaction the first time and last time I purchased bottled water in Chicago. The tax equaled the cost of the water. I now buy the water in the suburbs.

Comment by Ex Spsa Friday, Jan 13, 17 @ 12:40 pm
As a diet pop addict, I’m willing to do my part. BUT, let’s not increase the cost of the product by 50%.

Comment by Norseman Friday, Jan 13, 17 @ 12:41 pm
Well another item I will buy in bulk when I cross the river to Ky. to get my cheap gas and smokes.

Comment by Neiva Friday, Jan 13, 17 @ 12:42 pm
===and smokes===

Yep. Keep smoking those cheap cigs and drinking lots of cheap sugary drinks. Get a few cases of cheap whiskey while you’re at it. You won’t be around long enough to protest other taxes.

lol

Comment by Rich Miller Friday, Jan 13, 17 @ 12:44 pm
Fresh fruits and vegetables don’t require much manufacturing. I imagine the Illinois Manufacturers Association may be aware of this.

Comment by The_Equalizer Friday, Jan 13, 17 @ 12:44 pm
Any excuse to raise taxes…

Comment by Shanks Friday, Jan 13, 17 @ 12:48 pm
The state should have learned its lesson from the candy tax. I had to move to Wisconsin to get my daily M&M fix.

Comment by CLJ Friday, Jan 13, 17 @ 12:49 pm
That Pepsi news release had me all worked up and ready to grab my pitchfork.

Then I went and read the actual bill and am happy to see that most non-caloric sweeteners will not lead to an additional tax, 100% juice drinks will not have an additional tax, and drinks that have higher sugar from milk will also not be taxed.

http://www.ilga.gov/legislation/100/SB/10000SB0009.htm

Comment by Stuff Happens Friday, Jan 13, 17 @ 12:50 pm
===I had to move to Wisconsin to get my daily M&M fix. ===

So you paid a higher personal income tax to get a lower candy tax?

Either you way 900 pounds or you’re not very bright.

lol

Comment by Rich Miller Friday, Jan 13, 17 @ 12:52 pm
How about lite beer next….

Actually I am ok with this, would be cooler with it if they did include lite beer as well.

Comment by oneman Friday, Jan 13, 17 @ 12:54 pm
If soft drinks are bad for you, then why can you purchase them with SNAP benefits?

https://www.fns.usda.gov/snap/eligible-food-items

Comment by City Zen Friday, Jan 13, 17 @ 12:57 pm
I tend to agree that it’s a regressive tax, but also understand that we should price in the public health issues.

Comment by Arsenal Friday, Jan 13, 17 @ 1:00 pm
=Either you way 900 pounds or you’re not very bright.=

The correct answer is not very bright.

But actually, I lived there under Illinois’s higher income tax rate and my personal income tax was lower in Wisconsin than in Illinois. I know this for a fact because my employer at the time, in Illinois, withheld Illinois state tax. After reciprocity, I came out ahead. Progressive vs Flat.

Comment by Anonymous Friday, Jan 13, 17 @ 1:02 pm
1:02 is me

Comment by CLJ Friday, Jan 13, 17 @ 1:03 pm
Sugar is bad. So let’s make the government reliant on people consuming it.

Comment by Sugar dad Friday, Jan 13, 17 @ 1:05 pm
So I can buy a bag of sugar and box of tea bags, add water and still have my sweet tea without paying additional tax?

Comment by FormerParatrooper Friday, Jan 13, 17 @ 1:11 pm
You can call it what you want to “sugar coat” it but this it a tax on the middle class and the poor. It’s easier to tax the them because they don’t contribute millions to campaign funds.

SHAME ON THE ILGA For thinking about balancing the budget and paying for execlon( a highly profitable company) bailout on the backs of the middle class and poor

Comment by Publius Friday, Jan 13, 17 @ 1:16 pm
Seems ironic that at one time Chicago and the nearby suburbs was the candy producing capital of America.

Comment by Anonymous Friday, Jan 13, 17 @ 1:16 pm
- Neiva - Friday, Jan 13, 17 @ 12:42 pm:

Well another item I will buy in bulk when I cross the river to Ky. to get my cheap gas and smokes.

And if you are on Medicare or Medicaid, please be sure to go to KY for treatment of your diabetes, hypertension, COPD and/or lung cancer.

Comment by Anonymous Friday, Jan 13, 17 @ 1:17 pm
Back in the 30s bootleggers were running mountain dew.
In the 2010s it’ll be Mountain Dew.

Comment by Bluegrass Boy Friday, Jan 13, 17 @ 1:18 pm
City Zen - Friday, Jan 13, 17 @ 12:57 pm:
If soft drinks are bad for you, then why can you purchase them with SNAP benefits?
https://www.fns.usda.gov/snap/eligible-food-items

Because Coke and Pepsi have a lot of lobbyists and they make a lot of political contributions.

Comment by TominChicago Friday, Jan 13, 17 @ 1:19 pm
So just don’t buy it. Romeoville charges an additional 3% alcohol sales tax and after discovering that, I stopped buying that product in the village.

Comment by Romeo Friday, Jan 13, 17 @ 1:19 pm
Think I am going to buy me some Kool Aid stock.

Comment by Peters Post Friday, Jan 13, 17 @ 1:29 pm
Setting all else aside, if we are to accept that the taxation remedy works, we should examine whether there is less obesity in Arkansas than in nearby states such as Tennessee and Mississippi. So, does a sugar tax actually correlate with less obesity?

Comment by Keyser Soze Friday, Jan 13, 17 @ 1:31 pm
The really irritating thing is that (with some narrow exceptions) sugar is not bad. It’s just that it’s bad.

That is to say, despite many claims to the contrary, sugar isn’t especially unhealthy. Indeed the notion that food items can be categorized as inherently “healthy” or “unhealthy” is mostly false. But the problem is that some foods and ingredients are so, SO easy to consume in unhealthy ways. It’s what we do with these things that matter. A salad is usually good to eat because it contains a broad diversity of nutrients, fiber, water, and not too much in the way of calories. Not because it has acai berries.

Pepsi and others will be eager to point these facts out…but I don’t think that changes anything. Saying “well don’t do that then” has a dismal record as a public health policy. So I’m all for using something like this tax as a public health tool, even if I have my doubts it will actually be used to seriously curtail consumption, and even if it reinforces misunderstandings about “healthy” foods.

Comment by Threepwood Friday, Jan 13, 17 @ 1:42 pm
First, I’m fine with a tax on sugary drinks and even diet, aspartame causes it’s own issues(and studies show that many times diet drinks “cause” people to eat more due to the nature of the chemical). These are not necessary to survive, and, in many ways do act in the same way as other “vice” taxes, such as alcohol and cigarettes.
Second, I don’t think that a sugar tax would correlate with obesity except in extreme cases, but it would allow the state to have access to funding to treat diseases such as diabetes and obesity a bit easier.
Yes, I do drink pop on occasion, no I don’t have it every day, but am willing to pay the tax when I do drink it.

Comment by Union Thug Gramma Friday, Jan 13, 17 @ 1:47 pm
===Saying “well don’t do that then” has a dismal record as a public health policy.===

As any close review of “abstinence only” birth control strategies will clearly show.

Read the links and do some research. Sugar itself isn’t bad. It’s how much we consume and the ways in which we unknowingly over-consume sugar that this type of taxation is targeting.

“Research at the Harvard School of Public Health and elsewhere, for example, has tied sugary drinks to an epidemic of obesity in the United States. The average 12-ounce can of soda contains 10 teaspoons of sugar, and the average teenage boy consumes nearly three cans of sugary drinks a day. Is it any wonder that about two-thirds of Americans are now overweight or obese?

Obesity, in turn, raises the risk of type 2 diabetes, heart disease, arthritis, and certain cancers.”

https://www.hsph.harvard.edu/news/magazine/sugar-and-salt/

Comment by 47th Ward Friday, Jan 13, 17 @ 1:50 pm
Keyser:

Not necessarily. The mere existence of the tax may not be enough. It needs to be high enough to be prohibitive of consumption, which as I understand it has been seen to some degree with cigarettes. Which of course suggests a conflict with any intent to use the tax as a revenue source.

Union:

The only research I’m aware of which suggested diet drinks encouraged obesity was not high quality, and likely was swamped by fairly obvious confounders. About the only plausible argument I’ve seen so far is a psychological effect, for instance that people may decide they’ve “earned” more calories elsewhere.

Comment by Threepwood Friday, Jan 13, 17 @ 1:52 pm
47th is right, the science is compelling and pretty much air tight, to those that believe in science anyway.

Does a taxation remedy work? Cigarette smoking has substantially decreased since taxes have been raised on them. That’s not to suggest the relationship is causal - we also now have a variety of smoking bans, a lot of education, and of course the tobacco settlement.

I don’t think we’re banning sugar in any locale, but if Big Sugar were forced to do more education about the danger of their product, then that coupled with the higher taxes could make an impact.

Today, 29.8% of American adults are considered obese - not overweight, *obese*. In 1990, that number was 11.6%. More than one in three children under 16 are obese. Obesity is a public health crisis in its own right, leading to increased incidence of diabetes, hospitalization, etc. This impacts everyone’s health care costs, but more importantly, it impacts the individuals’ lives. Anything that can be done, should be done. This crisis isn’t going away without attention and finding the root causes. Like it or not, sugar is one of those.

Comment by Joe Bidenopolous Friday, Jan 13, 17 @ 1:53 pm
From ADM: “From high-fructose corn syrups and dry sweeteners to no- and low-sugar and reduced-calorie options, ADM offers a wide selection of sweetener products to meet varying needs for sweetness, flavor intensity, viscosity, glycemic response, particle size and price.

ADM helped introduce high-fructose corn syrup to the beverage industry, and today we are one of the leading producers of corn sweeteners including corn syrups, high-fructose corn syrups, maltodextrin, crystalline fructose and dextrose.

Our CornSweet® line is used in the beverage industry as a replacement for cane sugar, and in a variety of baking applications and canned foods. We offer CornSweet 42, which can be used to replace up to 100 percent sucrose; CornSweet 55, used in carbonated beverages; and CornSweet 90, which has an intense sweetness that makes it ideal for sweetening foods and beverages without adding a lot of calories.”

Comment by LIberty Friday, Jan 13, 17 @ 2:32 pm
=== IRMA: The tax is regressive. ===

Uhm, does mean IRMA would at least not oppose a progressive tax that did not target its industry?

Comment by anon Friday, Jan 13, 17 @ 2:36 pm
=== unpopular, at least with the Illinois Retail Merchants Association, is a proposed penny-an-ounce tax on sugary drinks…The tax is “regressive” and “unreliable” as a source of money… ===

So, are they supportive of a tax surcharge on those with 1/2 or million dollar incomes?

Comment by Anonymous Friday, Jan 13, 17 @ 2:55 pm
“Overnight, the retail price for a two-liter soft drink in Illinois could jump nearly 70 cents, a 12 pack of refreshments could increase $1.44, and a 12 pack of tea would add an additional $2.04 if Illinois lawmakers have their way.”

The moment when your argument shows how ridiculously unhealthy the product that you sell is…

Comment by Casual Observer Friday, Jan 13, 17 @ 3:23 pm
I live a couple blocks from a convenience store and see people buying a Polar Pop soft drink that must be at least 20 ounces. That’s about 13 teaspoons of sugar. The recommended daily limit is 6 tsp. for women and 9 for men.

No wonder we have a diabetes epidemic.

As an aside, is the U.S. government still subsidizing tobacco farmers?

Comment by Streator Curmudgeon Friday, Jan 13, 17 @ 3:41 pm
It’ll just keep going. Next up Salt. Surcharge on Chips, Pretzels, etc. We’ll know we’ve hit the summit when they propose a surcharge on Celery by the stalk.

Until then, if it tastes good…tax it.

Comment by A guy Friday, Jan 13, 17 @ 4:12 pm
“It’ll just keep going. …”

From the link posted above by - 47th Ward -

“Now the biggest issue, outside of too many calories, is the huge amount of sugar and salt…..Going for the low-hanging fruit is the first step, and the sugared beverage area is the place,”

Comment by CapnCrunch Friday, Jan 13, 17 @ 4:35 pm