Illinois Once More Debates Sugared Drink Tax

The Healthy Eating Active Living Act would add a penny-per-ounce excise tax on soda, energy beverages and other sugared drink distributors.

March 04, 2015

SPRINGFIELD, Ill. – Hoping that second time’s the charm, supporters of the Healthy Eating Active Living Act have reintroduced the legislation in the Illinois General Assembly late last week, the Herald & Review reports. The act would tack on a penny-per-ounce excise tax on soft drinks, energy drinks and other sugared drinks, which distributors of those bottled beverages would pay. For example, a 12-pack of soft drinks would increase by $1.44.

Illinois Sen. Mattie Hunter and Rep. Robyn Gabel are the bill’s sponsors. The measure has been referred to committee. Last year, the House Revenue and Finance Committee voted against the bill.

The tax would be levied on any bottled drink having more than 5 grams of sugar for each 12 ounces of liquid. Alcoholic beverages, as well as low-sugar and low-calorie drinks, would not be subject to the tax. The tax would fund obesity preventative programs via Medicaid, as well as health and wellness programs in high-need local communities.

“We know we're not going to tax ourselves out of diabetes, obesity and cancer,” said Mark Peysakhovich, senior director of government relations for the American Heart Association, which supports the bill. “The most important part is it's expected to bring about $600 million of new revenue.”

The Illinois Manufacturers Association views the measure as negatively impacting distributors and the entire beverage industry. “If you add $2.88 to the price of a case of soda, which is roughly a 50% increase, you’re going to have a lot of people go over state lines to buy products,” said Mark Denzler, Illinois Manufacturers Association vice president and COO.

West Virginia, Virginia, Tennessee and Arkansas already have extra excise taxes on distributors of bottled beverages. Other states are considering similar measures, including Connecticut, which has a one-cent-per-ounce tax on soft drinks before the legislators.

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