By a decisive 13-4 vote, the City Council in Philadelphia approved a 1.5-cent-per-ounce tax on sugary beverages and diet sodas. Mayor Jim Kenney presented the tax as a way to raise revenue for schools and recreation centers, unlike the public health arguments which succeeded in Berkeley in 2014 and are being used ahead of votes in Oakland, San Francisco and Boulder this year.
Proponents said victory in Philadelphia, the fifth-largest city, would generate impetus for success in other cities. The soda industry had prevailed against 43 other proposals since 2008 for local taxes. Berkeley voters, by a 3-to-1 margin, approved a 1-cent an ounce soda tax in a referendum in 2014.
“Philadelphia really provides a road map for other cities and states to adopt similar measures,” said consumer group Center for Science in the Public Interest. “The mayor’s leadership and commitment made all the difference. And it’s an historic defeat for Big Soda, which set more than $4 million on fire in an attempt to kill the proposal.”
If fiscal health was the selling point in Philadelphia, physical health has dominated the discussion of soda taxes elsewhere. Sugary drinks are the No. 1 source of added sugar in the U.S. diet. Two-thirds of American adults are overweight or obese, which increases risk of chronic disease such as diabetes and cancer.
“The government shouldn’t be focused on demonizing certain products,” said the American Beverage Association. Obesity has many causes, said the soda trade group, but sales of full-calorie soda are declining. Published reports said the soda industry might challenge the Philadelphia tax in court.
The one-cent tax proposed in Oakland, which borders Berkeley, has been framed as a way to fight obesity. City official say they would earmark the money, estimated at $12 million a year, for health and education programs in schools and in the community, guided by an advisory board, said the San Francisco Chronicle.
Supervisor Malia Cohen has taken the lead with a proposed 1-cent an ounce tax in San Francisco that would need a simple majority for passage. A proposal for a 2-cent tax was supported by 55 percent of voters in 2014 but not the two-thirds margin needed for enactment. Backers were a day late in filing petitions last month, so Cohen said she would take another route to the November ballot — having the Board of Supervisors approve the referendum, said public broadcaster KQED. The petition drive was led by Campaign Against Diabetes.
The coalition Healthy Boulder Kids submitted the proposal for an excise tax on soda and other sugary drinks in the Colorado city. “Supporters of the proposed tax contend that consumption of one sugary drink per day boosts the risk of childhood obesity by 55 percent, the chance of Type 2 diabetes by 25 percent and the possibility of death from cardiovascular disease by 30 percent,” said the Boulder Camera newspaper. The tax would be set at 2 cents per ounce on drinks that contain at least 5 grams of added sweetener per 12 fluid ounces.
To reach the November ballot, proponents must submit roughly 4,630 signatures from registered Boulder voters by July 11.
In Philadelphia, Mayor Kenney said the soda tax was “a historic investment in our neighborhoods and in our education system.”
Initially, Kenney proposed a 3-cent tax on sugary drinks. It was altered by the council a week ago to a 1.5-cent tax on full-calorie and diet beverages. “Kenney sold the council on the idea with a plan to spend most of the estimated $90 million in new tax revenues next year to pay for pre-kindergarten, community schools and recreation centers,” said WPVI-TV.
“The wide-ranging tax will include regular sodas, diet sodas, sports drinks, energy drinks and other nonalcoholic beverages with added sweeteners. It will be levied on distributors and could raise prices by 25% to 30% if passed along fully to consumers,” said Dow Jones.