Philadelphia Takes Third Swing at Soda Tax

Effort ‘a big hit to grocery and convenience-store owners’: opposition

PHILADELPHIA -- The Philadelphia City Council will consider a 3-cents-per-ounce tax on sugar-sweetened packaged beverages in coming weeks as part of Mayor Jim Kenney’s budget proposal outlined late last month.

soda tax receipt

The proposal—Bill No. 160176—applies to “any nonalcoholic beverage that lists as an ingredient any form of caloric sugar-based sweetener, including but not limited to sucrose, glucose or high fructose corn syrup.” It includes soda, non-100% fruit drinks, sports drinks, flavored waters, energy drinks and presweetened coffees or teas, among other beverage types.

If approved, the tax to be paid by beverage distributors would kick in Jan. 1, 2017, adding 3 cents per ounce to the cost of packaged drinks and 27 cents per ounce of fountain syrups.

Kenney said the tax would raise $400 million per year to fund a universal prekindergarten program and parks and recreation facilities and programs in the city.

Most of those watching the proposal expect beverage distributors will pass the tax on to consumers, leading those in opposition to voice concern about higher grocery bills and loss of jobs, should distributors see a decline in the sale of their products.

A group called Philadelphians Against the Grocery Tax, funded by the American Beverage Association, has launched a campaign encouraging residents to send letters of opposition to city officials.

“Higher taxes could really increase the prices on groceries like soda, juice drinks, sports drinks and teas,” the group said on its website. “This price spike would drive customers away from Philadelphia businesses, like corner stores and bodegas, into surrounding areas. This would be a big hit to grocery and convenience-store owners and their employees.”

The proposal is now in the hands of the city council, which opposed similar sugary-drinks tax proposals twice before under Kenney's predecessor Michael Nutter.

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