The Washington D.C. Council has voted to include sweetened soft drinks in its six percent sales tax bracket to help bridge the city s half-billion dollar gap between spending and earnings.
A soft drinks tax has been vigorously opposed by the beverage industry C as well as by many consumers C as similar local-level taxes have been elsewhere in the country. In D.C., the Maryland-Delaware-D.C. Beverage Association has set up an organization called No D.C. Beverage Tax , a coalition of local Washington D.C. citizens, businesses, and associations that are opposed to a new tax on beverages. The coalition has argued that a beverage tax is discriminatory and regressive , and that it would cost jobs.
The six percent sales tax would apply to artificially and sugar-sweetened soft drinks, including sodas, sports drinks and energy drinks, but not drinks containing milk, juice, coffee or tea. It is different from a previously proposed soft drink tax in D.C., which would have put a penny-per-ounce excise tax on soft drinks.
The tax is expected to raise about $7.92m a year. The final vote on the 2011 budget is scheduled for next month, before being sent to the mayor and Congress.
Soda taxes have been a controversial issue across the country, with advocates claiming that they could help tackle obesity while raising revenue to pay for health care reform or health promotion programs C or shrink budget deficits. But a proposed federal-level soda tax was left off the agenda in February, and just last week a proposed two-cent-per-ounce soda tax in Philadelphia was shelved.
However, several other states have gone ahead with soda tax proposals. New York governor David Paterson revived the idea of a penny-per-ounce tax on sugary drinks in January, as the city looked for ways to close its budget gap. Mississippi s state representative John Mayo introduced legislation to tax the syrup used to sweeten soda at a distribution level in January. In Kansas, Senator John Vratil put forward a proposal for a penny tax per teaspoon of sugar in soda, and Colorado has removed existing tax breaks on sugary beverages and candy.
