Higher Sugar-Sweetened Beverage Retail Prices After Excise Taxes in Oakland and San Francisco

Abstract

Objectives. To examine how much sugar-sweetened beverage (SSB) excise taxes increased SSB retail prices in Oakland and San Francisco, California.Methods. We collected pretax (April-May 2017) and posttax (April-May 2018) retail prices of SSBs and non-SSBs from 155 stores in Oakland, San Francisco, and comparison cities. We analyzed data using difference-in-differences high-dimensional fixed-effects regressions, weighted by regional beverage sales.Results. Across all beverage sizes, the weighted average price of SSBs increased by 0.92 cents per ounce (95% confidence interval [CI] = 0.28, 1.56) in Oakland and 1.00 cents per ounce (95% CI = 0.35, 1.65) in San Francisco, compared with prices in untaxed cities. The tax did not significantly alter prices of water, 100% juice, or milk of any size examined. Diet soda only, among non-SSBs, exhibited a higher price increase for some sizes in taxed cities.Conclusions. Within 4 to 10 months of implementation, Oakland's and San Francisco's SSB excise taxes significantly increased SSB retail prices by approximately the amount of the taxes, a key mechanism for reducing consumption.

FIGURE 1—

Differences in Price Changes Between Taxed and Comparison Cities Before (April–May 2017) and After (April–May 2018) Sugar-Sweetened Beverage (SSB) Excise Taxes: Oakland and San Francisco, CA Note. The dotted line indicates a 1 cent/oz increase in price (i.e., 100% pass-through for SSBs), and error bars indicate 95% confidence intervals. Estimates are from high-dimensional fixed-effects linear regression models, where we defined mean beverage price per oz as a function of a binary indicator for period, a binary indicator for San Francisco or Oakland, and their interaction. We clustered SEs at the store level. We weighted models for beverage categories (e.g., soda) by sales volume of each product (e.g., Coke 20 oz) across study beverages in that category using Nielsen data for the region. We weighted models for overall SSBs by volume sales of each type and size of SSB (e.g., small regular sodas) across all SSBs in Nielsen data for the region. We weighted models for overall non-SSBs in the same manner. Taxed cities included Oakland and San Francisco, and untaxed comparison cities included Richmond and San Jose, CA. We collected April–June 2018 prices approximately 10 mo after the tax implementation in Oakland (July 1, 2017) and 4 mo after the tax implementation in San Francisco (January 1, 2018).

FIGURE 2—

Differences in Price Changes by Store Type Between Taxed and Comparison Cities Before (April–May 2017) and After (April–May 2018) Sugar-Sweetened Beverage (SSB) Excise Taxes: Oakland and San Francisco, CA Note. The dotted line indicates a 1 cent/oz increase in price (i.e., 100% pass-through for SSBs), and error bars indicate 95% confidence intervals. Estimates are from high-dimensional fixed-effects linear regression models stratified by store type, where we defined mean beverage price per oz as a function of a binary indicator for period, a binary indicator for San Francisco and Oakland combined, and their interaction. We clustered SEs at the store level. We weighted models for overall SSBs by volume sales of each type and size of SSB (e.g., small regular sodas) across all SSBs in Nielsen data for the region. We weighted models for overall non-SSBs in the same manner. Taxed cities included Oakland and San Francisco and untaxed comparison cities included Richmond and San Jose, CA. We collected April–June 2018 prices approximately 10 mo after the tax implementation in Oakland (July 1, 2017) and 4 mo after the tax implementation in San Francisco (January 1, 2018).