Will New Mexicans support a soda tax to address obesity and diabetes?

Across the nation, more and more soda taxes are being passed. The election on Nov. 8 brought in four new soda taxes, including in Boulder, Colo., at 2 cents per ounce — the biggest soda tax passed to date in the United States. The city of Santa Fe is currently considering a similar 2-cent soda tax per ounce.

Soda taxes are a public health tool to help combat obesity and diabetes rates in the U.S., both directly and indirectly. Although existing research shows a small direct impact on reducing obesity, by making soda more costly through this tax, consumers may consume fewer calories by buying fewer sodas.

The indirect impact of soda taxes on health could be much larger by using the revenue generated to lower the cost of healthy foods through a subsidy or by increasing health education campaigns. If New Mexico had a penny-per-ounce soda tax in 2016, the Rudd Center for Food Policy and Obesity estimates in that year alone, we could have raised more than $90 million that could be reinvested in these programs.

New Mexico’s obesity and diabetes rates are steadily growing and putting an increasing strain on an overburdened health care system. This has motivated legislative proposals aimed at using soda taxes as a policy intervention. In 2010, state Sen. Gerald Ortiz y Pino introduced a bill to tax sugar-sweetened beverages one-half-penny per ounce. The majority of the generated revenue would have gone to a countysupported Medicaid fund. This bill did not pass the Legislature in 2010, and it died in committee in 2011.

Despite these failures, there has been one major success at passing a soda related tax in New Mexico. In 2014, the Navajo Nation passed the Healthy Diné Nation Act that applied a 2 percent tax on all minimal-to-nonutritional-quality food, which includes sodas. The revenue generated from the tax is to support community wellness projects, such as community gardens and playgrounds.

The New Landscapes of a Majority-Minority State, a study commissioned by the Robert Wood Johnson Foundation Center for Health Policy, provides some fresh data on this issue. In part, we asked if New Mexicans had previously heard about the Healthy Diné Nation Act (after describing it to them) and how willing they would be to support expanding it to all of New Mexico.

Despite finding low levels of awareness of the Healthy Diné Nation Act, there are promising signs of support for expanding the law. It is always difficult to pass new taxes, particularly in this budget climate, but we find that 39 percent of respondents are in favor of the law’s expansion, 36 percent in opposition, the rest undecided at this point.

Although soda taxes have been defined as a type of regressive tax — a tax that would disproportionately impact the poor — some of the highest overall support comes from respondents in the lowest income bracket across the state. We also find support is highest among those familiar with the Healthy Diné Nation Act, which suggests that a path to wider support should include education of the public about benefits to a statewide soda tax.

Just like tobacco taxes before it, soda taxes are conveyed as a regressive tax. But there are several factors that we need to consider before we define this tax in this way. First, people with lower incomes are more sensitive to price increases; hence they may switch to another, cheaper, beverage. Second, if the revenue generated is allocated toward programs that will disproportionately benefit those with lower incomes, such as supporting childhood nutrition or early childhood education programs (city of Santa Fe’s approach) or using the funds to help support Medicaid, then the benefit derived from these programs could offset the personal cost of a soda tax.

It will not be easy to pass a soda tax, and we do not find overwhelming support among the public to do so at this time. However, the support for this policy intervention is higher than we anticipated given the financial climate in the state. We suggest, to increase support for soda taxes in New Mexico, that it is critical to outline how the revenue generated would be allocated to combat obesity and related health issues, and help offset the potential costs for those with lower incomes.