Why 2017’s biggest food trend will be the soda tax.


It’s very possible that some of the words that are associated with “soda tax” are something like “progressive” and “groundbreaking.” But while Denmark implemented a similar tax as far back as the 1930s (although it’s been recently repealed), it’s arguably the biggest hot topic discussion in the world of commercial food ever since the Chipotle’s e.coli controversy last year.

And while four cities approved the tax this past Election Day, it’s yet to be a nationwide mandate. But at the very least, with more and more cities adopting the tax (with Philadelphia the first major US city to enact one), restaurants around the nation can finally can have an idea why it’s so important to look at the trend for next year.

This affects way more than just restaurants

It’s almost unnecessary to mention that restaurants won’t be the only place that will be affected by this. Convenience stores, grocery stores, vending machine companies, and bars across the US might have to get used to offering more expensive soft drinks than one would expect…especially since soft drinks outpace bottled water, milk, and coffee in terms of consumption alone.

And yet there’s another industry sector that can be quite affected by this: The soft drinks companies themselves. Soft drinks sales have been dropping for at least a decade, and consumption has fallen to a new 30-year low. In fact, it’s said that bottled water sales are making a resurgence.

The tax works…depending on who you ask

“This is just another tax so that the government can get more money!”

“We need so we can start fixing obesity!”

Those might be a couple examples of the opposing sides of the soda tax, but depending on who you ask it’s either the first step towards reducing obesity, or it’s just another tax. A NIH (National Institutes of Health) study concluded that a 20% sugar drink tax on the UK would see a decrease in obesity rates by 1.3%. But that’s just a study.

But if you want to see a real-world, contemporary example of the soda tax you have to look at Mexico. At first, it seemed to be working–with soft drink sales dropping as much as 12% in the first year the tax was implemented back in 2014. And while the tax could save the country $1 billion in healthcare costs and nearly 200,000 people from obesity, soda sales have actually risen in 2015. Wishful thinking? It’s possible.

A fundamentally different drinks menu?

While it’s arguably too early to tell what are the long-term effects of the soda tax (with the possible exception of Samoa which enacted its own soft drink law in 1984, however little data is available about the health impact). But where will this tax go from here? Although completely speculative, here are a few possibilities on what might happen should the sugar tax go widespread.

A. The soda tax will be popular enough where other food-related taxes such as the “fat tax” will become widespread.

Fatty foods such as hamburgers, donuts, and pizzas? A tax on such foods are already in effect in Indiana earlier this year. Some people would say such a tax would curb obesity, while Denmark, who already abolished its own “fat tax” back in 2012, said that it’s too much work and stymies too much revenue. Either way, the growing attention of the soda tax might attract the “fat tax” as well.

B. The bottled water will become the new “soft drink.”

If bottled water continues its almost skyrocketing rise in sales (compared to soft drink sales), then a domino effect might follow. Will restaurants see more water dispensers than soft drink dispensers? Will flavored water start a comeback? While there’s no clear answer on how water sales will go from there (although some say that the Flint Water Crisis played a role in influencing bottled water sales this year), so far bottled water only goes up from there.

C. Craft soda will finally get its moment.

Craft soda was, pun intended, all the buzz last year. And while one of the larger drink companies is starting to get its feet wet on it, there’s little (if any) attention on the new non-alcoholic beverage.With all the recent news on craft soda in the last few years, it’s possible that craft soda sales will mirror current craft beer sales (although there’s recent news that it might finally start to slow).