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California City Passes First-In-The-Nation Tax On Soda

The American Beverage Association spent about $11 million against the proposed taxes in two Northern California cities. The measure passed in Berkeley.

Posted on November 5, 2014, at 2:43 a.m. ET

Robert Galbraith / Reuters

Dr. Vicki Alexander, co-chair of the Yes on D campaign, poses for a portrait at the Measure D election headquarters in Berkeley, California on Monday.

Voters in Berkeley, California approved the first soda tax in the U.S. on Tuesday, following more than $2 million in expenditures against the ballot measure.

A similar tax failed in San Francisco, where approval was required by two-thirds of voters. 55% percent of voters were in favor of the tax on sugar-sweetened beverages, including sodas, energy drinks and pre-sweetened teas.

San Francisco would have added two cents per each ounce of soda. In Berkeley, voters approved a tax of one cent per ounce. Diet soda, milk and nutritional drinks are exempt. Distributors of the beverages — not consumers — will have to pay, though small businesses are excluded.

According to a U.S Department of Health and Human Services estimate from 2010, sodas and other sugary drinks account for more than 1/3 of added sugar in Americans diets. Supporters of the measures hoped to curb obesity rates, particularly in children, as well as health problems from diabetes to tooth decay.

Similar penny-per-ounce taxes have been attempted in the past, but all have failed. The soda industry spent more than $2 million fighting the Berkeley measure, and in San Francisco, $9 million went toward the opposition campaign.