More than 117 countries and territories have passed national-level taxes on sugary drinks, covering 57% of the world’s population. What started as an experiment in a handful of nations has become one of the most widely adopted public health policies in the world, with taxes now in effect across every global region.
The Global Picture
The World Bank’s global database tracks 119 national-level sugar-sweetened beverage taxes across 117 countries and territories. These range from small island nations in the Pacific to major economies like the United Kingdom, Mexico, South Africa, India, Saudi Arabia, and France. The taxes vary widely in structure: some charge a flat rate per liter, others scale the tax based on sugar content, and others apply a percentage markup to the retail price. The World Health Organization recommends that taxes raise the retail price of sugary drinks by at least 20% to meaningfully reduce consumption.
The United States is a notable holdout at the federal level, but several cities have enacted their own local soda taxes. Philadelphia, Seattle, San Francisco, Oakland, and Boulder all currently enforce taxes ranging from 1 to 2 cents per ounce. For a 2-liter bottle of soda, that adds between 67 cents and $1.30 to the price.
Mexico: The Landmark Case
Mexico’s 2014 soda tax is one of the most studied examples. The country had among the highest rates of sugary drink consumption in the world, along with soaring rates of obesity and diabetes. The government imposed a tax of roughly one peso per liter on sugar-sweetened beverages.
Over the four years following implementation, purchases of taxed sugary drinks dropped by 4.4% on average compared to what would have been expected without the tax, a reduction of about 43 milliliters per person per week. The effects were strongest in small neighborhood stores and public markets, where purchases fell by 11% and 23% respectively. Convenience stores, however, saw purchases increase by nearly 45%, suggesting some consumers simply shifted where they bought their drinks rather than cutting back entirely.
The UK’s Reformulation Strategy
The United Kingdom took a different approach when it introduced its Soft Drinks Industry Levy in 2018. Rather than simply taxing all sugary drinks at a flat rate, the UK created two tiers: a lower rate for drinks containing 5 grams or more of added sugar per 100 milliliters, and a higher rate for drinks with 8 grams or more. Drinks below 5 grams per 100 milliliters pay nothing.
This design was deliberately intended to push manufacturers to reformulate their products rather than just pass a tax along to consumers. It worked remarkably well. Between 2015 and 2019, roughly 65% of soft drinks that had been above the 5-gram threshold reformulated to fall below it. By 2019, 89% of the soft drink market contained less than 5 grams of sugar per 100 milliliters. People were still buying soft drinks, but the drinks themselves contained far less sugar.
South Africa’s Results
South Africa introduced its Health Promotion Levy in 2018, taxing beverages based on their sugar content above a certain threshold. The results were striking. Average sugar from taxable beverage purchases fell from 16.25 grams per person per day before the tax was announced to 10.63 grams per person per day in the year after implementation, a drop of roughly 35%. Volumes of taxable beverages also declined, from about 519 milliliters per person per day to 443 milliliters.
What makes South Africa’s data particularly interesting is that consumption started falling after the tax was announced but before it took effect, suggesting that the public conversation around the tax itself may have shifted behavior.
Where the Revenue Goes
Countries and cities use soda tax revenue in different ways. Berkeley, California generated $1.5 million in its early years and directed it to the school district and health-related programs. Philadelphia used its revenue to build parks and fund healthy living initiatives. Hungary raised 200 million euros in the first four years of its tax and used the money to give a 25% wage increase to nearly 95,000 healthcare workers.
These revenue choices shape public perception of the taxes. When the money visibly goes back into communities through schools, parks, or healthcare, the taxes tend to maintain broader political support than when the revenue disappears into general government budgets.