The response to Governor Maura Healey’s budget proposal to remove the current sales tax exemption from candy was as predictable as it was swift. Massachusetts declares war on Halloween! One more item for the New Hampshire shopping list! Throw the candy in the Harbor! And of course, a lavish use of the “Taxachusetts” sobriquet.
As Healey herself said, “Nobody likes taxes.” And a Tootsie Roll tariff is an especially fat target for critics of nanny-state nosey pokes who think the proposal would thwart their inalienable right to tooth decay.
But here’s the thing: Over-consumption of candy and other sugary foods contributes to chronic health conditions that cost all of us millions, whether we indulge in Snickers bars or not. Massachusetts residents already pay the second highest amount for health coverage in the country, with annual insurance premiums averaging $29,000 per family. And costs are surging: According to an independent report issued this month, Massachusetts spent $78 billion in total health care expenditures in 2023, an 8.6 percent increase per person over the previous year.
Those costs are driven largely by a few chronic conditions — diabetes, heart disease, high blood pressure — all associated with obesity. Designing candy taxes can be devilishly complicated, and if they work, any revenue benefits eventually diminish as demand drops. But if price signals discourage consumers from making unhealthy choices, and if the debate raises awareness of the dangers lurking in these empty calories, Healey will have done us all a favor.
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Extending the 6.25 percent sales tax to these products would hardly make Massachusetts an outlier, since it is one of roughly a dozen states that currently give candy a pass. From Arkansas to Illinois, candy is taxed at a higher rate than other groceries. Moreover, we are surrounded by states that also tax sugary soft drinks. So why stop at candy? Sugary sodas are, if anything, more hazardous to your health: liquid candy with typically no nutritional value. There’s a reason health experts have been saying for years that soda is the new smoking. As yet, we haven’t seen thirsty hordes surging across the border from Rhode island to buy tax-free cases of Fanta.
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Bills that would tax sugary sodas in Massachusetts are hardy perennials — I first wrote in favor of such legislation in 2010. In the end, the proposals have tended to succumb to opposition from soda distributors and retailers. But the winds may be shifting. Boston City Councilor Sharon Durkan has renewed the debate with a call for hearings on a soda tax in Boston, modeled after successful efforts in Philadelphia and Seattle. In Maryland and even red state Nebraska, lawmakers are mounting campaigns to impose new taxes on drinks with added sugars, both to raise revenue and to stem the rising tide of obesity.
To be sure, many people are now addressing obesity through the new class of weight loss drugs. But these expensive drugs are in such high demand that they too are exploding state health care budgets and spiking insurance premiums for everyone.
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The governor’s office estimates removing the candy exemption could yield about $25 million in new revenue, hardly a blip in a $62 billion budget. But $25 million is just about what it would take to fully fund the state’s Healthy Incentives Program, which reimburses recipients of food stamps when they purchase fresh fruits and vegetables. Last year the state had to cap the reimbursements at $20 a month because of inadequate funding.
I rarely find myself opposite the progressive Center on Budget Policy Priorities, which is cool to Healey’s candy tax concept because it is regressive, weighing more heavily on low-income households than wealthier ones. But obesity and its miseries also disproportionately affect lower-income families and racial minorities. All sales taxes are regressive, but at least the modest candy tax will be paid by everyone, whereas initiatives to restrict what recipients of SNAP benefits can buy — which 10 states, all led by Republicans, are considering this year — looks a lot more like poor-shaming.
I don’t want regressive taxes. But I do want a market that reflects the true costs of things, and the hidden price of sugar in our diets is staggering. At a time when federal support for health care in the states is uncertain at best, a few pennies on the dollar doesn’t seem like such a bitter pill to swallow.
Renée Loth’s column appears regularly in the Globe.
