Most funded initiative in state historySeptember 28, 2010 @ 2:57 am (Updated: 3:46 pm - 3/28/11 )
They say taking candy away from a baby is pretty easy. Apparently, it's more challenging to take away candy, soda and bottled water taxes in Washington. At least $14 million has been raised for Initiative 1107, making it the most funded initiative in state history.
This is a record year with $38.6 million raised so far to either support or fight six initiatives that will be on the General Election ballot in our state. The only other years we've come close to this amount was in 2007 with $21 million raised and 2005 when $22 was raised. Insurance and health care issues were on the ballot those years.
Initiative 1107 is one of the more complicated ballot measures. It would repeal three different types of taxes on four products.
Toward the end of the last legislative session in Olympia, lawmakers added a sales tax to some candy, a temporary sales tax to some bottled water, a temporary excise tax to carbonated beverages and increased tax rates for certain food processors.
Have I lost you already?
It gets more confusing when you consider that some candy, if it's made with a certain amount of flour, is not taxable. A Kit Kat bar, for example, isn't taxed. M&Ms are taxed and if you add those M&Ms to trail mix, that's taxable too. Craisins, basically dried cranberries that resemble raisins, are considered a candy too. Here's the Washington Department of Revenue's spreadsheet on 12,613 candy items, if you want to see if your favorite treat carries the new tax that took effect in June.
A "yes" vote on Initiative 1107 would repeal all the added taxes.
Celia Schorr wants to keep the taxes as they are. She's with the anti-1107 campaign. "It's worth a couple of cents more on a can of pop to fund education and health care," she says.
Tim Martin, President of Harbor Pacific Bottling based in Elma, Washington, wants to get rid of the extra taxes. He says those pennies add up for a family-owned business like his because "the soft drink business is a very low margin, high volume business. With the taxes in place, July was one of the worst on record for his company.
"We've eliminated all of our advertising spending. We haven't invested in equipment that we otherwise would," Martin says. They also let five employees go from their company of 45.
But Schorr says imagine the cuts the state will have to make if it loses hundreds of millions of dollars from the taxes.
"When people out there are saying there's still fat to be cut, there really isn't. We're down to the bone now," she says, "and we're talking about really devastating impacts to the people who are most vulnerable. Those are our kids and our seniors."
Have lawmakers considered every possible cut before they raise taxes? Martin doubts it. Plus, the money from these taxes goes to the general fund. The money isn't earmarked for education, health care, or any specific program.
"They could just as well be earmarked for government waste," he says.
Schorr says that won't happen "because we know what cuts were narrowly avoided by passing these taxes." Some of those areas include K-12 education and social services programs.
Even if you don't care about bottling company and local candy businesses, Martin says all residents should be concerned about Initiative 1107 because it gives the state "one more way to tax us," and these could "creep up every year" for consumers.
"It's a veritable piggy bank for politicians, I think, if they think that this is okay," he says.
Most of the $14.4 million raised to repeal the taxes comes from the American Beverage Association.
A report from the state public disclosure commission shows the beverage association made eight contributions to Initiative 1107 worth $14,209,000. One other distributor kicked in $100, and eight individuals are responsible for campaign funds totaling $195.
Schorr calls the Initiative a "tax break for Coke and Pepsi" at the expense of Washington citizens. The campaign against repealing the taxes has only raised about $321,000 to get their message out. Their largest contributions of $60,000 each came from the Community Health Network of Washington and the Washington Federation of State Employees.
Ballots for the November 2nd General Election will be mailed October 13th.
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