The Philly Soda Tax is a Go

by DMA Staff | Sep 21, 2018
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In 2016, the City of Philadelphia passed an ordinance that taxes sweetened beverages, particularly sodas. The new tax received a lot of opposition including the American Beverage Association who has been working toward fighting similar taxes across the country. The 1.5 cent per ounce tax is imposed on the distributor, but opponents argued that the tax will shift to the consumer and is, therefore, double taxation along with the state tax already imposed on the beverages. The tax reached the Pennsylvania Supreme Court and in July 2018, the courts reached the decision that the tax did not cause duplication in taxation as " the beverage tax is assessed at a different tier of commercial activity than the state sales and use tax, since the beverage tax generally is paid at the distributor/dealer level. “ (p4 of the Supreme Court Opinion.

Soda taxes have proven to be a source of revenue. On January 1, 2018, Seattle’s sweetened beverage tax was enacted at $0.0175 per fluid ounce. The new tax was able to generate over $4 million in revenue for the city within the first three months.

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