How has the coronavirus lockdowns affected soda consumption?
With the onset of the coronavirus pandemic in March 2020, we set aside our project evaluating the ongoing impact of Philadelphia's controversial soda tax. But now, we can tap our established data sources and use the city's beverage tax collection data to see how the consumption of taxed beverages changed in Philadelphia in response to the lockdown measures state and local politicians imposed on its residents and businesses.
The following chart illustrates Philadelphia's monthly tax revenues from its soda tax and reveals what we found in comparing the period from January 2017 through February 2020 with the coronavirus lockdown recession period of March 2020 through December 2020.
Pennsylvania imposed its first statewide coronavirus lockdown on 17 March 2020. In the "before" period, the city of Philadelphia collected an average of $6,424,887 per month from its controversial soda tax.
But from March 2020 through December 2020, the city's monthly tax revenue from the Philadelphia Beverage tax dropped by 13.3% to an average of $5,570,658 per month.
This is where we decided to have some fun with a "what if" analysis. According to Harvard's soda tax advocates, a $0.01 per ounce tax increase on beverages would increase prices of taxed beverages by 16.3%, causing soda consumption to fall by 20%. The advocates believe the resulting reduction in soda consumption provides health benefits in the form of the reduced incidence of obesity and diabetes.
The 13.3% reduction in Philadelphia's soda tax collections represents the amount by which Pennsylvania's coronavirus lockdown restrictions have reduced soda consumption in the city. Going by the Harvard researchers' study, the coronavirus lockdown recession has provided the health benefits of the equivalent of an additional $0.00665 per ounce increase in the Philadelphia Beverage Tax, reducing the incidence of both obesity and diabetes in Philadelphia.
Does anyone really believe that happened in Philadelphia during the coronavirus pandemic?
References
City of Philadelphia. Department of Revenue. City Monthly Revenue Collections. [Online Database]. Accessed 19 March 2021.
Harvard T.H. Chan School of Public Health CHOICES (CHildhood Obesity Intervention Cost-Effectiveness Study) Project. Brief: Cost-Effectiveness of a Sugar-Sweetened Beverage Excise Tax in 15 U.S. Cities [PDF Document]. 12 December 2016.
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