The Philadelphia City Council on Thursday approved a soda tax on sugar-sweetened and diet beverages, becoming the first major city to impose such a policy.
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The city expects to generate $91 million annually from the new tax, with about half the money funding an expansion of pre-K programs in a city where K-12 education is widely considered to be in awful shape. That would add $1.02 to the cost of a two-liter bottle of soda pop.
The American Beverage Association has already spent more than $1.5 million on an anti-tax campaign.
“The tax passed today is a regressive tax that unfairly singles out beverages – including low- and no-calorie choices”, the ABA said in a statement.
Philadelphia has approved a tax on soda – and it’s the first major USA city to do so.
Currently, Berkeley, CA is the only other US city with a comparable tax-and their population of only 112,000 means the tax affects far fewer than the 1.5 million Philadelphia residents impacted by the new law. Lawsuits are expected soon.
Two other USA cities, Oakland, California, and Boulder, Colorado, are considering implementing similar taxes.
Philadelphia is the second city in the U.S.to tax soda.
“You are acting boldly to deal with very real concerns and needs of Philadelphians and our country as a whole”.
In Philadelphia, critics of the tax have said the city’s poor will carry the heaviest burden.
Beverage businesses argue sales will go down and jobs will be lost.
Philadelphia’s city council weighed a sugary beverage tax in 2010 and again in 2011, but the measure failed both times.
In Philadelphia, more than 68% of adults and 41% of children are overweight or obese.
He said last week that Americans generally reject other people telling them what’s healthy for them, so his administration tried to stay away from that.
“It’s a perfectly valid thing to do, and it has additional social benefits on top of the revenue benefits”, said John Donaldson, director of fixed income at Haverford Trust Co.in Radnor, Pennsylvania. It will go into effect January 1, 2017 and is expected to generate about $91 million a year for municipal coffers with proceeds going towards expansion of pre-K programs, park and recreation offerings and the city’s general fund.
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But Baltimore City Health Commissioner Leana Wen commended Philadelphia’s tax, saying in a statement Thursday that it “is a great step toward improving public health”. Distributors will be required to pay it on all sugary or artificially sweetened drinks, and may choose whether or not to pass it on to consumers. “In November, voters in three California cities will take up the issue, and it may also come before voters in Boulder, Colorado”.
