Working Paper: NBER ID: w25050
Authors: John Cawley; Chelsea Crain; David Frisvold; David Jones
Abstract: We estimate the incidence of a relatively new type of excise tax, a tax on sugar-sweetened beverages (SSBs). We examine the largest such tax to date, which is two cents per ounce, in Boulder, CO. Using data that were hand-collected from stores and restaurants in both Boulder and two control communities, as well as internet data of restaurant menus, we find that the tax was largely, but not completely, passed through to consumers 5-7 weeks after implementation. Some retailers add the tax only at the register, indicating that estimates solely from posted prices would result in an underestimate of pass-through.
Keywords: Sugary-Sweetened Beverages; Tax Incidence; Public Health
JEL Codes: H22; H75; I18
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| SSB tax (H29) | retail prices (D49) |
| SSB tax (H29) | passthrough rate variation by store type (L81) |
| SSB tax (H29) | passthrough for fountain drinks (L66) |
| SSB tax (H29) | no significant price changes in untaxed beverages (H29) |