Philadelphia: Overstepping Bounds With New Sugar Tax?
This week, the city of Philadelphia announced its intention to tax sugary drinks. The so-called “soda tax,” will add a hefty per-ounce tax onto sugar drinks. In one illustrative example, a
Philadelphia Inquirer article noted that two-liter bottles of Coke are on sale for $1. Roughly, a liter is little more than a quart, so that's about $2 a gallon. Now add the approximately $2.56 in soda tax. The new price of $3.56 is hardly a sale when residents can shop outside the city limits to save. And a tax that outweighs the actual price point of the product? Yikes.
The Vending Times explained that Philadelphia Mayor Michael Nutter included in his 2010-'11 budget a plan to levy what some are calling the highest tax in the nation on all sweetened beverages. The proposed 2 cents-per- ounce tax (dubbed the “Healthy Philadelphia Initiative”) would apply to fountain syrups and powders, based on the number of fluid ounces they produce. Diet drinks without added sugar would be excluded.
I have to admit, I’m no fan of governments heavily taxing anything. Targeted taxes, of course, aren’t new. “Sin” taxes on cigarettes and alcohol are popular all across the country. (As an aside, I remember many friends and family driving across the border from Illinois to Kentucky to buy cigarettes years ago. Ironically, Kentuckians were driving right past those cars to get lottery tickets in Illinois before Kentucky had lottery gaming).
Opponents argue this is a slippery slope. What’s next? Taxing cheese, milk or bread? Any of those are potentially fattening when they’re not moderated. Why should local governments decide what to tax? On the flip side, is moving more toward a consumption tax a better idea for the United States?
And is the tax simply a counterproductive, shell game approach to push residents of Philadelphia to get their sugar fixes in the ‘burbs?
What do you think?