Beverage taxes are bubbling up from the local to the state level.
Connecticut may become the first state in the country to tax sugar-sweetened beverages if Gov. Ned Lamont has his way.
He’s proposed a 1.5-percent-per-ounce tax on sugary drinks, which he expects will generate $163.1 million for the Nutmeg State in fiscal 2021, which begins the preceding July, He says it will also help residents become healthier.
Several municipalities across the U.S. have put similar taxes in place, including Seattle; Philadelphia; San Francisco; and Boulder, Colorado.
Such taxes are not necessarily shoe-ins. The one in Cook County, Illinois, which includes Chicago, was repealed in 2017.
“The governor believes that in addition to addressing our long-term fiscal stability, the budget should also help outline policy priorities for our state,” Lamont’s spokeswoman Maribel La Luz said in an e-mail, adding that proposals, like this tax, are meant to discourage unhealthy behaviors.
She said Connecticut currently meets or exceeds many national health targets, but can do more to tackle chronic conditions, such as heart disease and cancer, which have become leading causes of death in the state and contribute to rising health care costs. Obesity affects 26.9 percent of adults in Connecticut and more so among minority groups.
What makes this first-ever statewide effort significant is it reduces the likelihood of consumers going to neighboring areas to avoid the tax — what experts call leakage. While it’d be easy to go from a taxed city to a nearby suburb, leaving a state is a hassle.
“With a larger geographic scope of the policy, you have less opportunity for people to cross the border to do their beverage shopping,” said Shu Wen Ng, a health economist at the University of North Carolina at Chapel Hill. “For both health implications and revenue generating, a state level or larger geographical scope would be more meaningful.”
More than three dozen countries and territories around the globe have instituted sugar-sweetened beverage taxes, she added. Among them are Mexico, France, Norway, Estonia, Saudi Arabia, Bermuda, Thailand, South Africa, Fiji and the Philippines.