Backed by advocates and medical professionals, lawmakers argued strongly on Wednesday for a new excise tax of a penny per ounce on sugary beverages, re-igniting an old political debate.
The Alliance for a Healthier Vermont, a coalition of 38 organizations which includes some Vermont hospitals and advocates for the poor, joined with lead sponsor Rep. Dave Sharpe, D-Bristol, to propose the tax, arguing that it would address obesity in the state.
Citing a study by the Yale Rudd Center for Food and Policy, the coalition estimates the tax would raise $27 million in revenue, which they propose to direct towards state health care subsidies and a handful of other public health initiatives.
“We have a problem here in Vermont,” said Sharpe at a Statehouse press conference. “It’s a growing problem. It’s obesity.”
Of the tax, co-sponsored by over two dozen House lawmakers, he added, “It may not be a silver bullet, but it is a first step towards dealing with a critical problem in our nation and in our state.”
But the coalition may not even succeed with the first step, since the proposal faces an uphill political battle.
Shumlin flatly opposes the tax, state Health Commissioner Harry Chen told VTDigger.
“The research on a sugar-sweetened beverage tax is not as conclusive as it is with tobacco (cause and effect); it is clear that it is not a magic bullet. This is especially true given our long and porous borders,” Chen said in an email. “We don’t want to put Vermont businesses at a competitive disadvantage; we need their help in solving this complex problem.”
However, Chen acknowledged obesity as a serious problem in Vermont, estimating that the state spends about $950,000 annually to combat it, with a mix of state and federal funds.
“There is no doubt we could always do more with additional money, but it’s important for us to do everything we can with what we have,” wrote Chen.
The state’s Health Department estimates that 26 percent of children and 58 percent of adults in Vermont are obese, with about $291 million spent yearly on obesity-related medical costs statewide.
The coalition estimates that obesity costs $163 million annually in Medicare and Medicaid costs, with $187 million a year in lost productivity.
In 2010, Attorney General Bill Sorrell backed a similar proposal, which didn’t make it out of the House Ways and Means Committee.
Sharpe said that the need for health care funding is more pronounced this time around, and that even if it’s ultimately unsuccessful, the proposal would spark helpful political conversations.
The coalition wants the tax revenue to help Vermonters currently on VHAP and Catamount health care transition to the health care exchange in 2014, where they’re expected to pay thousands more in upfront and premium costs.
Meanwhile, lobbyists for the beverage and grocery industries were raring to respond after the coalition’s press conference.
Andrew MacLean, lobbyist for the Beverage Association of Vermont, and Jim Harrison, president of the Vermont Grocers’ Association, argued that the tax would harm local businesses by sending thirsty customers across state borders; that it regressively targets poorer Vermonters; and that it’s simply more symbol than substance, because soda drinks aren’t driving obesity.
They also have statistics of their own. In a package produced by the Beverage Association, figures indicated that calories from added sugars in soda decreased 39 percent since 1999 in the American diet.
The suggestion that the tax harms poorest Vermonters most is one that Karen Lafayette, executive director of the Vermont Low Income Advocacy Council, bristles at. It’s a suggestion also made by some Democratic politicians.
“The charge that it’s regressive is really a fallacy,” said Lafayette, who backs the tax. “I think actually the tax could become progressive when the revenues it raises are going for education, the purchase of nutritious food, and for filling the gap for health care costs.”
Speaking earlier at the press conference, Lafayette made clear she believed the tax would act as an effective deterrent: “Low-income folks are more sensitive to prices, especially children. A public awareness campaign, along with a price increase, will encourage low-income Vermonters to make healthier choices.”
The legislation has other worthy goals, she added. It would also subsidize the purchase of fruits and vegetables, school meals for poor students, and provide electronic benefit transfer terminals to Vermont farmer’s markets, thereby encouraging healthy eating, said Lafayette.
If imposed, the tax would be the only state tax on sugar-sweetened beverages in the country. Referendums to abolish such taxes imposed by state legislatures in Maine in 2008 and Washington in 2010 passed handily.
For more on this debate, read VTDigger’s article breaking the news when the proposal first surfaced in December.
