Seattle, Washington consumers shopping at their local Costco were met with a sticker shock recently. The beverages they enjoyed were suddenly overpriced. An average pack of Gatorade had a sudden 65 percent increase in price.

Seattle is taxing sugary drinks

This latest sugar Tax went into effect Jan. 1st, 2018.

According to the Washington Examiner, "While it is true that, all other things being equal, a price increase will reduce consumption, that is not the only effect a price increase has. Consumers change their behavior to avoid the higher prices by shopping outside city limits, as they have in Philadelphia, where sales of carbonated soft drinks fell in the city by 55 percent, but sales in the surrounding towns rose 38 percent."

Does this tax help?

Statistics seem to indicate a decline in consumption of sugary drinks when taxes on the drinks are imposed.

So, the short answer is yes. The extra price hike is causing people not to drink sodas or change to diet Soda.

New Seattle tax disproportionately taxes the poor. According to a 2013 Gallup poll, nonwhites, and the low-income in the U.S. drink more regular soda than other Americans.

Obesity in this country is on the rise

Obesity is often found in lower income areas. So naturally, this tax is disproportionately targeting low-income people. Not surprising, since if you have been to a grocery store lately, you find out pretty fast that eating healthy isn’t cheap. Compare a gallon of milk to two liters of soda.

Who is this helping?

According to the City, this tax will earn $15 million, in revenue. This money will go to programs helping lower income families.

However, disproportionately, the lower income American’s, are the ones buying sugary soda. Thus, paying the tax for their own programs. Now, if they stop buying, or go elsewhere for their soda habit, the city is out their millions. And the poor are out the programs, that the tax is supposed to support.

Does Seattle want soda sales reduced?

If they did want soda sales reduced, why would they put invaluable services on the backs of soda drinkers? They need people to continue to buy sugary drinks, in order for the revenue to continue.

Hang tight Seattle

There is a strong chance that this new tax will quickly prove itself a waste of money and time.

With any luck, you will be drinking tax-free soda once again.

Meanwhile, I don’t know how the city will support the programs that tax was meant to pay for. Maybe they could skim the money off whatever groceries the wealthy disproportionately buy. Of course, there is always that risk they will go elsewhere.
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