Opposition mounts for sugary drink tax
Joe Taitano II | May 17, 2023 | The Guam Daily Post
A fast-food chain operator and a local diabetes awareness advocate are on the same page about a proposal to tax sugary drinks: No, thanks.
Sen. Roy Quinata on Monday announced Bill 118-37, which would tax locally manufactured and imported drinks with added sugar at a rate of 2 cents per ounce. The revenue stream is meant to go toward the upkeep of sporting facilities in the school system and the community.
There's no telling yet how much money the tax could potentially bring into the government of Guam coffers, as lawmakers await a note on the bill's fiscal impact from the Bureau of Budget and Management Research.
The measure points to high rates of noncommunicable diseases on the island, such as obesity and diabetes, and is intended to reduce consumption of sugary drinks and push for a healthier Guam.
But increased costs won’t stop folks with diabetes from reaching for a sweet beverage, it will only hurt their pockets, according to Scott Duenas, president of the Guam Diabetes Association.
“With Guam Diabetes Association, we don't tell people to stop drinking soda or stop eating candy. We tell them to do it in moderation. Because if you start giving up everything, you're (going to) die,” Duenas said.
People with diabetes know what they have to do to get their health under control. And if they don’t, they need to get informed, he said.
“They're concerned about people's lives? Good. But don't kill them by stopping them from enjoying life. … If a person doesn't know his medical situation, then he has to go see a doctor. But (for) the legislator to control what we drink by overpricing everything? I disagree with that.”
What was most important was that people be screened early if they believe they are at risk for diabetes, Duenas said.
Some members of the medical community have lodged less-than-stellar opinions on the proposed tax's potential impact on health.
Pass along the costs
With businesses still struggling to recover from the pandemic, and supply chain issues and inflation driving the cost of seemingly everything through the roof, it's no time to throw another tax at the business community, said Frank Cruz, a member of the Guam Chamber of Commerce.
Besides sitting on the chamber’s board of directors, Cruz is the vice president and general manager of Guam Fast Food Inc., which operates KFC and Sbarro Pizza locally.
Cruz said he has to grapple with rising costs for chicken, gas and construction. Lawmakers should see what business owners pay for utilities, he said, “it’s almost doubled.”
“We just, you know, battle, and battle every commodity out there. And this is not something we need right now.”
Even before the proposal of the drink tax, one of his big beverage suppliers had just proposed a 50% price hike on syrup used to mix drinks, Cruz said. That would amount to about a 10% increase to the price of a medium fountain drink.
And between the wholesalers, the retailers and the restaurants, consumers may get stuck picking up costs that are even higher than the rate added on by the tax.
“The wholesalers, yeah, they’ll pass it on. And if they are not able to pass it all on the sugar, they'll pass it on different things they sell it and other items. But nobody's in business to lose money.”
It’s not uncommon to see businesses avoid states with high taxes entirely, Cruz said. And if they do decide to stay around, they will be more likely to cut staff and go the route of automating jobs away.
He didn’t argue with the point that Guam’s sporting facilities needed money for repairs, but asked, “Why are we the ones that they choose to fund it?”