Beverage sales went down in cities that enacted soda taxes. Philly saw the biggest change.

Philadelphia saw the biggest drop in sweetened beverage sales among five cities that implemented soda taxes, a new study found.

Philadelphia became the first major U.S. city to tax sweetened beverages in 2017, and the law was a major cornerstone of former Mayor Jim Kenney’s administration. He touted it as a way to fund pre-K and rehabilitate recreation centers, which about half the money has gone toward, at least until 2022. While the tax initially stirred up controversy in the city, it has since fizzled.

The Jan. 5 Media&utm_medium=referral&utm_campaign=ftm_links&utm_term=010524" target="_blank">study, which was published by health policy journal JAMA Health Forum, analyzed sugar-sweetened beverage taxes — known as soda taxes — in Philly; Boulder, Colo.; Oakland, Calif.; San Francisco; and Seattle. It found that prices on sugar-sweetened beverages for distributors increased by an average of 33.1%, with 92% of the increased cost passed on to consumers, at 496 stores across the five cities. Meanwhile, purchases for these drinks declined 33%, a drop almost equal to the rise in prices.

All five cities saw sugary sales go down as prices went up, but Philadelphia was tops. The city saw the highest price increase at 58.3%, and the highest sale decrease, at 46.8%.

The Philly law requires 1.5 cents to be taxed per ounce of sweetened beverage — it applies to both regular and diet sodas, as well as any nonalcoholic beverage that has sugar or sweeteners listed as an ingredient, like energy drinks, presweetened coffee or tea, and mixers. While the tax is levied on beverage distribution, it is often passed down to consumers through price increases.

Mayor Cherelle L. Parker pledged on the campaign trail that she will maintain the tax but did not answer whether the proceeds will continue to go to the same programs. She did not respond to a request for comment on Monday.

While studies have assessed soda taxes in various locations, this study is unique because it looked at multiple U.S. cities.

Marion Nestle, a nutrition and food studies professor at New York University, said that this study shows more significant changes than other studies, and most notably, consistency across different cities.

“I think what this study shows is that these taxes are having the effect that they were intended to have, and that this is a reasonable public health measure,” Nestle said. “If it’s something that discourages consumption of full sugar beverages, it’s a really good idea.”

The study said that research has found both significant financial and health benefits to these kinds of taxes, including reductions in diabetes, strokes, and obesity. But those benefits can be contradictory.

“The better this tax does in making people healthier, the worse it will do” in raising money for city initiatives, said John Buhl, communications director at the Urban-Brookings Tax Policy Center. “There’s a tension there.”

The American Beverage Association (ABA), which spent millions lobbying against the law, disputed the study’s statement that the tax has led to improved health benefits and instead touted industry trends as a reason for reduced sugar intake.

“The beverage industry’s strategy of offering consumers more choices with less sugar, smaller portion sizes and clear calorie information is working — today nearly 60% of all beverages sold have zero sugar and the calories that people get from beverages has decreased to its lowest level in decades,” ABA spokesperson William Dermody said in a statement. “On the other hand, a beverage tax has never been shown to improve public health or to reduce beverage calories in a significant way.”

» READ MORE: How Mayor Kenney’s soda tax ignited controversy and impacted Philadelphia

Critics of the tax also argue that people who want to buy sugary drinks without the higher price tag can simply drive out of Philadelphia, but the data isn’t clear. There are studies that found significant increases in sugary drink purchases in areas near cities with these taxes, while others found no changes — this study didn’t find evidence of changes.

Buhl said there is still a lot to be researched, including which populations are buying fewer unhealthy drinks and what this tax law would look like in Republican-leaning jurisdictions. Additionally, he wants to know how much credit the tax law should get for consumption changes, as compared to public messaging campaigns.

“This is a helpful start, but there’s still more work to do to make sure we’re properly assessing the total impact of this policy,” he said.

While more than 50 countries have implemented these kind of taxes, just eight U.S. jurisdictions have done so as of November 2022, according to the study.

Buhl also questioned the logistics of relying on a revenue stream that could be unstable. While the soda tax coming in lower in the future could be a good thing for public health, that means the city has to find another way to fund pre-K.

The tax has brought in a total of about $480 million, with revenue fluctuating between $69.9 million and $76.9 million each year.

Nestle, the professor, said that while naysayers argue the changes in consumption doesn’t make a difference, she believes even small changes are good “because sugar-sweetened beverages really aren’t good for you.”