A Synthetic Control Analysis of Philadelphia, Pennsylvania’s Excise Tax on Sugar-Sweetened and Artificially Sweetened Beverages and Supplemental Nutrition Assistance Program Benefit Redemption

Abstract

Objectives: To assess the effect of a 2017 excise tax on sugar and artificially-sweetened beverages in Philadelphia, Pennsylvania on the shopping patterns of low-income populations using Supplemental Nutrition Assistance Program (SNAP) data. Methods: A synthetic controls approach was used to estimate the effect on Philadelphia and neighboring Pennsylvania counties (Bucks, Delaware, Montgomery) as measured by total SNAP sales (“SNAP redemption”) and SNAP redemption per SNAP participant. Biannual data (2005-2019) were assembled from all US counties for SNAP redemption and relevant predictors. Placebo tests were performed to estimate statistically significant effects, and robustness checks were conducted. Results: Detectable increases in SNAP spending were observed in all Philadelphia neighbors. Increases in per-participant SNAP spending were detected in two neighbors, and a decrease was detected in Philadelphia. These effects were robust across multiple specifications and placebo tests. Conclusions: The tax contributed to increased SNAP shopping in Philadelphia’s neighbors across both outcome measures, and decreased spending in Philadelphia (at least by one measure). This raises questions about retailer behavior, the effectiveness of the tax’s public health aim of reducing SSB consumption, and policy aims of investing in low-income communities.