LOCAL NEWS

Beverage association says Seattle soda tax would hurt businesses

Feb 24, 2017, 10:25 PM | Updated: Feb 25, 2017, 11:40 pm

A spokesperson for the Washington Beverage Association says a Seattle soda tax could be detrimental to small businesses.

Report: 5 big Seattle ideas voters rejected because of tax increases

Jim Cullinan with the Beverage Association says the proposed 2-cents-per-ounce tax on surgery drinks is too expensive for small businesses that are already struggling to survive in the city.

“A 2-liter bottle that could be on sale for 99 cents would be hit with a tax of $1.36,” he said. “That is more tax than the cost of the product itself. What is the impact on the businesses trying to survive in Seattle?”

The group is trying to meet with the Seattle City Council and Mayor Ed Murray to discuss alternatives to a Seattle soda tax to raise money for education.

In his State of the City address, Murray said he wants a Seattle soda tax of 2 cents per ounce on sugary drinks. That includes items such as soda, energy drinks, and sports drinks, and bottled Starbucks drinks and iced teas.

The tax would be about $1.44 per six-pack of soda, according to KIRO 7.

The tax would be placed on distributors and the money generated from it would fund education programs and “eliminate the opportunity gap between white students and African American/black students and other historically under-represented students of color,” Murray said.

That tax could be passed onto the consumer via higher prices, as it has in other cities with similar taxes.

The tax could be repealed by voters with a referendum if enacted by the city council.

Some have praised the idea. A doctor in Philadelphia — Philadelphia implemented a 1.5-cent-per-ounce tax in January — told KIRO Radio’s Dave Ross it benefits people and programs. The city has reportedly received $5.7 million thanks to the tax.

But Cullinan and the Beverage Association argue a soda tax would be a burden on people and businesses.

“We certainly understand Mayor Murray’s desire to fund early education,” he said. “We don’t believe this is the right approach…”

There’s a similar sentiment from business owners and the American Beverage Association over in Philly. The Ax the Bev Tax Coalition released a statement opposing the tax, despite the revenue it’s brought in, The Philadelphia Tribune reports.

“Regardless of how much money the administration says it collected in the first months of this tax, the pain Philadelphia families and businesses are feeling is very real,” the statement says.

The president of Canada Dry Delaware Valley Corp. told The Tribune that the tax is having a “devastating impact” on its business and customers.

But, like Dr. Kenneth Margulies argues, “An individual person will either choose to pay the added cost and support the revenue goals of the policy or reduce their consumption and support the health goals of the policy,” Margulies said. “As a community, I suspect there will be a balancing of the two.”

Cullinan says the Beverage Association doesn’t have any specific alternatives to a soda tax but is looking forward to a “constructive dialog” with the city to make sure everyone has a sense of the implications.

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Beverage association says Seattle soda tax would hurt businesses