Soft drink tax: Colorado lawmakers may repeal after one year

Friday, March 14th, 2014 By

Soft drink tax Colorado

The soft drink tax in Colorado may be repealed by the end of this legislative session. Image: Flickr / MoneyBlogNewz / CC-BY

In March of 2010, Colorado consumers began paying a tax on sugary products, commonly referred to as the soft drink tax. This soft drink tax, in Colorado, equaled an additional 2.9 percent cost. Now, some lawmakers are trying to repeal the Colorado soft drink tax.

The soft drink tax in Colorado

In March of 2010, Colorado consumers started paying a 2.9 percent sales tax on soda and candy bars. The tax is estimated to have contributed more than $10 million to the Colorado budget this year. The intention of the soft drink tax in Colorado was twofold. First, the soft drink tax was intended to bring money into the state. Second, the soft drink tax was intended to fight obesity by cutting consumption of sugary, high-calorie products.

Effort to repeal soft drink tax for Colorado

Rep. David Balmer, supported by the Colorado Beverage Association, has introduced a bill to repeal the tax on soda but keep the tax on candy bars. The justification to repeal the tax is based on two separate arguments. The first argument for repeal is that the tax is unfair because some fruit juices can be as sugary as carbonated soft drinks. The second argument for repeal is that the soft drink tax represents “social engineering” that some legislators feel is inappropriate.

Effect of repealing soft drink tax in Colorado

Several health groups, including researchers for Yale University’s Rudd Center for Food Policy and Obesity, have argued for even higher taxes on soda and other fattening foods. A 2009 study published in the New England Journal of Medicine indicated that “sugar taxes” may be a legitimate way to cut consumption of fattening foods. Later studies indicated that taxes such as the one in Colorado may not be high enough to have any real effect. Either way, it is estimated repealing the soft drink tax will cost Colorado $12.3 million, and the reality is that soft drinks, diet and regular alike, may have a detrimental effect on health.


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