Great idea. Let’s tax Coke and Pepsi to pay for health care?

This administration continues to fly trial balloons that in many cases turn into reality. And that my friends is scary. Janet Adamy of the Wall Street Journal has just written a story of the Obama Administration  considering an increase in taxes on soft drinks or other sweetened drinks to help offset the massive cost of his health care proposals.  Excerpts from her article are posted below along with the story link.

Guess what Mr. President. In addition to your braintrust looking for ways to fund your programs you might take a survey of who will be hurt the most by this action if you move forward with it. My knee jerk is the people least able to cover that increase, you know, those who blindly voted for you.
Change. That’s all they will have left in their wallets should this become a reality.
MAY 12, 2009

Soda Tax Weighed to Pay for Health Care

Senate leaders are considering new federal taxes on soda and other sugary drinks to help pay for an overhaul of the nation’s health-care system.

The taxes would pay for only a fraction of the cost to expand health-insurance coverage to all Americans and would face strong opposition from the beverage industry. They also could spark a backlash from consumers who would have to pay several cents more for a soft drink.

On Tuesday, the Senate Finance Committee is set to hear proposals from about a dozen experts about how to pay for the comprehensive health-care overhaul that President Barack Obama wants to enact this year. Early estimates put the cost of the plan at around $1.2 trillion. The administration has so far only earmarked funds for about half of that amount.

The Center for Science in the Public Interest, a Washington-based watchdog group that pressures food companies to make healthier products, plans to propose a federal excise tax on soda, certain fruit drinks, energy drinks, sports drinks and ready-to-drink teas. It would not include most diet beverages. Excise taxes are levied on goods and manufacturers typically pass them on to consumers.

The Congressional Budget Office, which is providing lawmakers with cost estimates for each potential change in the health overhaul, included the option in a broad report on health-system financing in December. The office estimated that adding a tax of three cents per 12-ounce serving to these types of sweetened drinks would generate $24 billion over the next four years. So far, lawmakers have not indicated how big a tax they are considering.

Proponents of the tax cite research showing that consuming sugar-sweetened drinks can lead to obesity, diabetes and other ailments. They say the tax would lower consumption, reduce health problems and save medical costs. At least a dozen states already have some type of taxes on sugary beverages, said Michael Jacobson, executive director of the Center for Science in the Public Interest.

Some recent state proposals along the same lines have met stiff opposition. New York Gov. David Paterson recently agreed to drop a proposal for an 18% tax on sugary drinks after facing an outcry from the beverage industry and New Yorkers.

The beverage-tax proposal would apply to drinks that many Americans don’t consider unhealthy — such as PepsiCo’s Gatorade and Kraft’s Capri Sun — based on their calorie content.

Health advocates are floating other so-called sin tax proposals and food regulations as part of the government’s health-care overhaul. Mr. Jacobson also plans to propose Tuesday that the government sharply raise taxes on alcohol, move to largely eliminate artificial trans fat from food and move to reduce the sodium content in packaged and restaurant food.
The White House, meanwhile, is pulling together private health groups to identify cost savings that will help fund the health overhaul. Mr. Obama on Monday held a White House meeting with groups that represent doctors, hospitals, insurers, pharmaceutical companies and medical-device makers. They pledged to help restrain cost increases in the health-care system in an effort to save $2 trillion over the next decade.

“When it comes to health-care spending, we are on an unsustainable course that threatens the financial stability of families, businesses and government itself,” Mr. Obama told reporters.

http://online.wsj.com/article/SB124208505896608647.html


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