Friday the Mexican congress passed a nationwide soda and "junk food" tax.
l've written so much on these sorts of taxes, it is hard to know what more can be said. I suppose the best, succinct thing I can say is what I sent in a letter to the New York Times, in response to a previous story they ran about the issue:
Writing about a proposed 7.7 cent per liter soda tax in Mexico, Elisabeth Malkin cites a Mexican corner store vendor who doubts the tax will make a dent in sales. The economic research concurs with this assessment. Study after study has shown that soda taxes of this magnitude will have trivial effects on weight, and yet will raise revenue from many consumers who can least afford to pay. For example, my co-authored study in the Journal of Health Economics estimates that a 10% tax on sugar-sweetened soft drinks would reduce weight by only about two tenths of a pound. Another study from Cornell University has even found evidence of adverse unintended effects from soda taxes that arise from increased consumption of higher calorie juices or alcohol. Denmark recently repealed their fat tax for precisely these reasons: complications arising from unintended consequences and consumer backlash. We all want people to lead healthy, fulfilling lives but we must also marry these concerns with the evidence on whether the policies being pursued will actually create the benefits we desire.
A 20% tax on sugar sweetened drinks would lead to a reduction in the prevalence of obesity in the UK of 1.3% (around 180 000 people). . . . Taxation of sugar sweetened drinks is a promising population measure to target population obesity, particularly among younger adults.
I suppose the good thing about the Mexican developments is that we can finally put to test the predictions of some of these simulation models.