Sugary drink tax third parties (MXC) and so want to consume at the unregulated market equilibrium to maximize their utility. This means that there is overconsumption of sugar and a welfare loss is created. The sugary drinks tax, a Pigovian tax, is a way to correct the negative externality by regulating the consumption of sugary drinks. Without a sugary drink tax, taxpayer money is used to pay for higher health care costs incurred from high consumption of sugar. Although this solution corrects the negative consumption externality, taxpayers that consume sugary drinks moderately and hence do not contribute to higher health care costs, still
Sugary drink tax low-income families, adding education programs and studying the tax on how it impacts behavior. Seattle collected $4 million in the first four months of the tax. Coca-Cola has been under fire since 2015 when emails revealed that funding for scientific studies sought to influence research to be more favorable to soda. Research funded by soda companies are 34 times more likely to find soda has no significant health impacts on obesity or diabetes. Taxing soda can lead to a reduction in overall consumption, according to a scientific study published in the "Archives of Internal Medicine" in March 2010. The study