Soda tax proposed in Texas; a local business reacts

TX Rep. Farias says there's a correlation between higher prices and lower consumption

Ashlie Rodriguez, Reporter
POSTED: 10:27 PM MDT Mar 18, 2013 
EL PASO, Texas -

Taxing sugary drinks is an idea being proposed by legislators across the country, and so far it's failed in blue states like Washington, Maine and New York. But Texas Rep. Joe Farias of San Antonio thinks its time for texas to give the health tax a try.

"I believe that Texas should adopt a penny-per-ounce soft drink tax to accomplish... the public health goal of reducing obesity through decreasing consumption of sugary drinks," Farias said in a statement.

Farias estimates the tax would generate $1-2 billion per year that could go to the state's education fund, while at the same time decreasing the chances of 15 million Texans becoming obese by 2040, according to the Texas Health Institute.

David Flynn of Novamex, the leading U.S. marketer of hispanic soft drinks located in downtown El Paso, is firmly against the tax, which he expects will raise the cost of doing business for not just for beverage companies, but their suppliers and retailers too.

"It's a very big business in the U.S," Flynn said. "And that's why its seems like the thing to tax while it really doesn't make any sense."

Adding a penny to every ounce of soda will cost Novamez $45 million a year --- an expense they can't afford and will have to pass down to the consumer.

"It's essentially a tax on groceries," Novamex said. "Somebody buying a family size soda will have to pay another 50cents for that purchase. It's an unfair burden on people."

Farias though says there's a correlation between higher prices and lower consumption, and an opportunity to encourage people to think and drink healthier even if you have to tax people to do it.