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Responses of different income groups to tax on sugar-sweetened beverages: a censored demand approach

Research output: Contribution to Journal/Magazine › Journal article › peer-review

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Responses of different income groups to tax on sugar-sweetened beverages: a censored demand approach. / Sharma, Anurag; Hauck, Katharina; Hollingsworth, Bruce et al.
In: Health Economics, Vol. 23, No. 9, 09.2014, p. 1159-1184.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Sharma, A, Hauck, K, Hollingsworth, B & Siciliana, L 2014, 'Responses of different income groups to tax on sugar-sweetened beverages: a censored demand approach', Health Economics, vol. 23, no. 9, pp. 1159-1184. https://doi.org/10.1002/hec.3070

APA

Sharma, A., Hauck, K., Hollingsworth, B., & Siciliana, L. (2014). Responses of different income groups to tax on sugar-sweetened beverages: a censored demand approach. Health Economics, 23(9), 1159-1184. https://doi.org/10.1002/hec.3070

Vancouver

Sharma A, Hauck K, Hollingsworth B, Siciliana L. Responses of different income groups to tax on sugar-sweetened beverages: a censored demand approach. Health Economics. 2014 Sept;23(9):1159-1184. Epub 2014 Jun 4. doi: 10.1002/hec.3070

Author

Sharma, Anurag ; Hauck, Katharina ; Hollingsworth, Bruce et al. / Responses of different income groups to tax on sugar-sweetened beverages : a censored demand approach. In: Health Economics. 2014 ; Vol. 23, No. 9. pp. 1159-1184.

Bibtex

@article{4770b7206fec40aabd5e923620fc6beb,
title = "Responses of different income groups to tax on sugar-sweetened beverages: a censored demand approach",
abstract = "This paper investigates the impact of sugar-sweetened beverages (SSB) taxes on consumption, bodyweight and tax burden for low-income, middle-income and high-income groups using an Almost Ideal Demand System and 2011 Household level scanner data. A significant contribution of our paper is that we compare two types of SSB taxes recently advocated by policy makers: A 20% flat rate sales (valoric) tax and a 20 cent/L volumetric tax. Censored demand is accounted for using a two-step procedure. We find that the volumetric tax would result in a greater per capita weight loss than the valoric tax (0.41 kg vs. 0.29 kg). The difference between the change in weight is substantial for the target group of heavy purchasers of SSBs in low-income households, with a weight reduction of up to 3.20 kg for the volumetric and 2.06 kg for the valoric tax. The average yearly per capita tax burden on low-income households is $17.87 (0.21% of income) compared with $15.17 for high-income households (0.07% of income) for the valoric tax, and $13.80 (0.15%) and $10.10 (0.04%) for the volumetric tax. Thus, the tax burden is lower, and weight reduction is higher under a volumetric tax.",
keywords = "sugar-sweetened beverages tax, soft drink, obesity, tax regressivity, censored demand",
author = "Anurag Sharma and Katharina Hauck and Bruce Hollingsworth and Luigi Siciliana",
year = "2014",
month = sep,
doi = "10.1002/hec.3070",
language = "English",
volume = "23",
pages = "1159--1184",
journal = "Health Economics",
issn = "1057-9230",
publisher = "John Wiley and Sons Ltd",
number = "9",

}

RIS

TY - JOUR

T1 - Responses of different income groups to tax on sugar-sweetened beverages

T2 - a censored demand approach

AU - Sharma, Anurag

AU - Hauck, Katharina

AU - Hollingsworth, Bruce

AU - Siciliana, Luigi

PY - 2014/9

Y1 - 2014/9

N2 - This paper investigates the impact of sugar-sweetened beverages (SSB) taxes on consumption, bodyweight and tax burden for low-income, middle-income and high-income groups using an Almost Ideal Demand System and 2011 Household level scanner data. A significant contribution of our paper is that we compare two types of SSB taxes recently advocated by policy makers: A 20% flat rate sales (valoric) tax and a 20 cent/L volumetric tax. Censored demand is accounted for using a two-step procedure. We find that the volumetric tax would result in a greater per capita weight loss than the valoric tax (0.41 kg vs. 0.29 kg). The difference between the change in weight is substantial for the target group of heavy purchasers of SSBs in low-income households, with a weight reduction of up to 3.20 kg for the volumetric and 2.06 kg for the valoric tax. The average yearly per capita tax burden on low-income households is $17.87 (0.21% of income) compared with $15.17 for high-income households (0.07% of income) for the valoric tax, and $13.80 (0.15%) and $10.10 (0.04%) for the volumetric tax. Thus, the tax burden is lower, and weight reduction is higher under a volumetric tax.

AB - This paper investigates the impact of sugar-sweetened beverages (SSB) taxes on consumption, bodyweight and tax burden for low-income, middle-income and high-income groups using an Almost Ideal Demand System and 2011 Household level scanner data. A significant contribution of our paper is that we compare two types of SSB taxes recently advocated by policy makers: A 20% flat rate sales (valoric) tax and a 20 cent/L volumetric tax. Censored demand is accounted for using a two-step procedure. We find that the volumetric tax would result in a greater per capita weight loss than the valoric tax (0.41 kg vs. 0.29 kg). The difference between the change in weight is substantial for the target group of heavy purchasers of SSBs in low-income households, with a weight reduction of up to 3.20 kg for the volumetric and 2.06 kg for the valoric tax. The average yearly per capita tax burden on low-income households is $17.87 (0.21% of income) compared with $15.17 for high-income households (0.07% of income) for the valoric tax, and $13.80 (0.15%) and $10.10 (0.04%) for the volumetric tax. Thus, the tax burden is lower, and weight reduction is higher under a volumetric tax.

KW - sugar-sweetened beverages tax

KW - soft drink

KW - obesity

KW - tax regressivity

KW - censored demand

U2 - 10.1002/hec.3070

DO - 10.1002/hec.3070

M3 - Journal article

VL - 23

SP - 1159

EP - 1184

JO - Health Economics

JF - Health Economics

SN - 1057-9230

IS - 9

ER -