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Tax has health benefits

Published:March 23, 2010, 10:34 PM

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Updated: August 21, 2010, 9:53 AM

State legislators should think long and hard about eliminating the governor's proposed

penny-per-ounce excise tax on sugary beverages, because if they do ... a likely scenario ... they

will eliminate a hefty chunk of revenue that will have to be offset elsewhere in the budget.

New taxes are not a good idea in a high-tax state like New York. But a use tax on a

commodity that's not a necessity is not a blanket penalty, and this one carries health

benefits to boot.

The proposed tax on sugary beverages has drawn support as a step toward reducing

consumption and, eventually, combating obesity, especially among the young. That would pay

dividends in the long run by curtailing needed health care, curbing diabetes and saving lives.

Health Commissioner Richard Daines has been among those promoting this proposal, and

talking to members of the State Legislature in particular about the health benefits and the

need to identify another $1 billion in budget cuts if this idea is defeated. During these

fiscally difficult times, that warning should gain some traction ... but lawmakers also are

worried about a new tax when voters already are angry about state government and an inept and

inert governing body.

Daines, though, points out that 60 percent of adults and 30 percent of children in New York

are overweight, with obesity driving up health care costs and reducing productivity while also

demanding higher insurance premiums and taxes for treatment. According to Daines, New Yorkers

pay 80 percent of the $8 billion in annual obesity-related health care costs for Medicaid and

Medicare, and the remainder in health insurance premiums.

He hopes the $1 billion a year raised by the tax will support critical health care services

and prevent deeper cuts at a time when the state has to close a $9 billion deficit.

The issue is rooted in a shift nearly 30 years ago from sugars to high-fructose corn syrup as

a beverage sweetener. The syrup, which came from government-subsidized corn crops, was far

cheaper and, over the years, sweetened-beverage prices increased far less than the prices of

other foods. Consumers saw them as economical and bought more, encouraging producers not only

to make sweeter beverages, but to increase bottle sizes. The evidence for that is in every

supermarket now.

Proponents say the excise tax will help close the gap between healthier foods and sugary

beverages with artificially low prices, eventually encouraging healthier choices. That should

have an effect on the main argument now used against the tax, too ... that higher prices will

cost beverage-industry jobs. Expanding the market for healthier beverages can make that a

shift, not a just a loss.

Most of us understand, at least on an intellectual level, that Americans have grown fatter.

As we're slurping the latest, greatest and largest drinks at movie theaters and convenience

stores, we should consider that more than one in six U.S. children is obese, three times the

rate in the 1970s ... and that obesity is a major contributor to cardiovascular disease,

according to recent studies. Higher rates of Type II diabetes over the past two decades also

can be linked to higher rates of obesity, with young people now accounting for almost half of

the new cases in some communities.

It's no secret that low-income communities are most affected by the cost-and-consumption

issue. Sugary soft drinks are available in abundance at neighborhood convenience stores and

cost less than fresh fruit and vegetables, thanks to sales tax exemptions for soda and snack

food in many states and to corn subsidies for farmers. The poor have little choice but to buy

cheaper stuff, and buy empty calories in the process. That's costly to them, and costly to

society. Communities must do what they can to decrease the price and increase the availability

of healthier foods and beverages, but from a health standpoint, let alone a state-revenue one,

adjusting the price disparity to close the gap makes sense, too.

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