Soft Drink Industry Squashes Tax Plan

The soft drink industry has successfully stopped a plan that aimed to tax sugared beverages, the Los Angeles Times reported.

Advocates had said the proposed tax would have reduced obesity and helped finance healthcare reform. And public health advocates assumed the tax would accepted by congressional Democrats searching for revenue to fund expanded health insurance coverage, the costs of which were mounting especially in relation to ailments caused by excess weight.

But White House staff reviewing funding options never really got behind the idea even after President Obama expressed interest last summer. A key congressional committee, after initially appearing receptive, refused to consider it and minority advocacy groups, including some committed to fighting obesity, lined up against the tax after years of receiving financial support from the industry, the Los Angeles Times noted.

Meanwhile, beverage lobbyists fought back attacking some of the country’s most distinguished nutrition scientists, accusing them of bias and distorting available evidence. The beverage industry also financed research that reached conclusions favorable to its position, and reached out to other industries for help.

“The industries in our coalition realized that this is a slippery slope, that once government reaches into the grocery cart, your business could be next,” said Kevin Keane, senior vice president, public affairs, for the American Beverage Assn. The coalition, operating under the name Americans Against Food Taxes, included the soft drink makers, their suppliers, and such mass-marketers as McDonald’s and Domino’s Pizza.

Using the argument that higher food and drink taxes would unfairly burden the poor, the coalition recruited a number of Latino groups, including the Hispanic Alliance for Prosperity Institute, the National Hispana Leadership Institute and the League of United Latin American Citizens.

Public health analysts were surprised to find that the list included the National Hispanic Medical Assn., which represents 36,000 Latino doctors and focuses on health issues, such as obesity-related diabetes, that hit Latino youth especially hard. Most of the Latino groups, including the medical association, had received beverage industry money in the past or have industry representatives on their governing boards, the Los Angeles Times reported.

The coalition launched an intense lobbying effort, including a $10-million television ad campaign in key markets warning against taxing food. The paper industry, a major supplier of fast food companies, also contacted members of Congress to help fight the tax.

Democratic Rep. John Lewis, the civil rights pioneer who represents Atlanta, the corporate headquarters of Coca-Cola, argued that the soda tax could lead to taxes on other foods, raising prices for hard-pressed consumers during a severe recession. And he asked, ‘If you begin taxing one sugar product, where do you draw the line?’

Rep. Ron Kind (D-Wis.), who represents a rural district where dairy farming is widespread, said he became concerned about the fairness of targeting one industry. Kind had heard from local Pepsi and Coke distributors, and he and other members also received letters from the National Milk Producers Assn. concerned that the proposed tax could apply to chocolate milk.

“We went from having real interest in this idea to it just falling off the table,” said Rep. Linda T. Sanchez (D-Lakewood), a member of the tax-writing House Ways and Means Committee. “It was my perception that opposition increased as members began hearing from local businesses” that were part of the beverage industry coalition.






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