The Rudd Center for Food Policy and Obesity, a nonprofit research and public policy organization based at the University of Connecticut, has a calculator that estimates potential tax revenues from a sugary drink tax. The organization released an update to its sugary drink tax calculator, which was funded by Voices for Healthy Kids, an initiative of the American Heart Association, in April. The update uses the latest data and models to estimate just how much money states can expect to raise should they pass a sugary drink tax on beverages like fruit, sports and energy drinks, sweetened coffee and tea, and soda.

We sat down (virtually) with the calculator’s designer, Tatiana Andreyeva, to learn more about what went into the update and what she hopes comes out of it.

Tatiana Andreyeva, PhD

Day Job: Associate Professor in the Department of Agricultural and Resource Economics, Director of Economic Initiatives at the Rudd Center for Food Policy and Obesity at the University of Connecticut

Involvement: Researcher and analyst of the sugary drink tax calculator

Fun fact: This health and nutrition advocate is also an animal lover, having rescued two dogs and four cats from her local shelters.

Tell us a little bit about how this sugary drink tax revenue calculator came to be.

About 15 years ago, Kelly Brownell, the former director of the Rudd Center, had the genius idea to create a calculator that could estimate the revenue a tax on sugary drinks could bring in. He knew it would help policymakers in deciding whether a sugary drink tax would work for their city, county or state.

For the new version of the calculator, I analyzed the latest data on sugary drink sales and research on the effectiveness of sugary drink taxes implemented around the country and globally to determine tax revenue estimates for states and even the nation. 

This new information will hopefully help policymakers determine how much revenue a tax could raise in their communities if they were to implement one. Advocates and community members might also be interested because it can help them see how much money could be raised to go back into community programs they care about.

What data and research do you use to determine the estimates?

The data we use is from the Beverage Marketing Corporation, which has proprietary information on the sales of a variety of drinks, such as carbonated soft drinks, fruit beverages, ready-to-drink tea and coffee, sports beverages and energy drinks. This includes sales at all types of retailers – supermarkets, restaurants, vending machines and convenience stores. I use the Beverage Marketing Corporation’s data as the primary source for my tax estimates. I also use the Consumer Price Index from the Bureau of Labor Statistics to analyze how the price of sugary drinks changes over time. That allows users to predict expected sugary drink prices and tax revenues for the next several years.

What differences in the updated calculator can users expect to see?

The newly released model is revised from the original calculator. It uses slightly different assumptions now that we have more evidence from places with sugary drink taxes like Seattle. In this way, it is a living model that I can update based on how the data changes. 

We have new evidence now from real-world sugary drink taxes…so our revenue estimates reflect that and their accuracy is much improved.

That said, there are some other changes. For example, we will no longer show the number of gallons consumed or revenue estimates at the local level. That information will only be available at the state level moving forward.

It’s clear that a lot of hard work goes into calculating these estimates. What makes all the time you spend on this worth it?

Policymakers interested in bringing a sugary drink tax proposal to their city, county or state must have projected tax revenue totals to gain legitimate support. This calculator is invaluable to them, especially if the bill they are trying to pass includes language stating that the revenue raised will be re-invested back into community programs and services. The revenue estimate helps them ascertain just how many programs they can fund. That’s huge when trying to earn public support of a sugary drink tax.

What we have seen with the latest research and data is that our new estimates are very close to reality. For example, in Seattle, the amount of revenue raised is very close to what we are predicting. That is a great quality check for our estimates. At the same time, we want to keep in mind that these are still estimates that have uncertainty around them due to data limitations.

How do you feel about seeing your analysis and predictions used in this way?

I am very happy to see it being used – that’s our goal at the Rudd Center. We want to do policy-relevant research and there is no better example of policy-relevant research than what this tax calculator provides. Every day we receive more and more evidence on how these taxes are working – both here in the U.S. and internationally like in Portugal and Mexico.

It’s important that people and organizations using this tool understand that I have done my due diligence to make sure the calculator is accurate, but that there are data limitations. The sugary drink tax estimates are built on a set of assumptions and adjusted regional (not state-specific) data on beverage sales. That’s why I document every data source and every assumption to justify and legitimize the estimates the calculator provides. Everything is very transparent so there is no question of where the information is coming from.

Dreaming big, what would you like to see happen next in the world of sugary drink taxes?

It would be great if we had a state tax, especially in larger states, as issues related to cross-border shopping would be perhaps less important. If that happened, we could compare the revenue of what was raised to the amount we predicted and truly test the model we devised.

But ultimately, as a health-centered organization, we want to see people buying fewer sugary drinks. Taxes can help change consumer behavior, as it happened with tobacco, while also raising revenue for critical community programs.