November 2021
Article
Psychological Science

A Salient Sugar Tax Decreases Sugary Drink Buying

By: Grant E. Donnelly, Paige Guge, Ryan Howell and Leslie John

Format:Print

Abstract

Many governments have introduced sugary drink excise taxes to reduce purchasing and consumption of such drinks; however, they do not typically stipulate how such taxes should be communicated at point-of-purchase. Historical, field, and experimental data entailing over 225,000 purchase decisions indicated that introducing a $0.01/ounce sugar sweetened beverage (SSB) tax—without making it salient on price tags—had no effect on purchasing (-1.26%; p=.28). However, when “Includes Sugary Drink Tax” was added to tax-inclusive price tags, SSB purchasing was lower than: pre-tax (-9.78%; p<. 001); a post-tax period when drinks did not bear price tags (-5.04%; p<.001); and a post-tax period when drinks bore tax-inclusive price tags that did not mention the tax (-3.83%, p=.002). Making the tax’s beneficiary (student programs) salient on price tags had no added effect. Two follow-up experiments suggest that tax-salience was effective partly because consumers overestimate the tax amount, leading to reduced purchase intention.

Keywords

Decision-making; Open Data; Open Materials; Preregistered; Health; Policy; Taxation; Consumer Behavior; Decision Making

Citation

Donnelly, Grant E., Paige Guge, Ryan Howell, and Leslie John. "A Salient Sugar Tax Decreases Sugary Drink Buying." Psychological Science 32, no. 11 (November 2021): 1830–1841.