Thirst for Cash Brings Push To Tax Sweet Drinks

Cities and states continue to look for revenue sources, and the District of Columbia is considering extending the city's 6 percent sales tax to sugary beverages.

May 25, 2010

WASHINGTON - The push for taxing sugary beverages is gaining momentum across the country, as lawmakers in cash-starved municipalities and states seek new sources of revenue, the Associated Press reports.

Proponents argue that in addition to generating much-needed cash, the taxes will help curb obesity rates and can pay for health programs. But retailers and the beverage industry maintain that the taxes are unpopular, unfair, and won't achieve the intended results.

While a federal proposal last year to add a penny per ounce drink tax fizzled, since then, lawmakers in more than a dozen states and several cities have taken up the issue, proposing similar taxes to fill budget gaps.

"It's really picked up since the federal fight," said Chris Gindlesperger, a spokesman for the American Beverage Association, which opposes the taxes, saying they unfairly target one product.

The issue may resurface this week in Washington as the city's governing body, the District of Columbia Council, considers extending the city's 6 percent sales tax to sodas and other sugar beverages, which are currently exempt. A proposed 1-cent-per-ounce tax on sugared beverages died in the legislature last week.

If the measure passes, the district won't be alone. Roughly 30 states now apply a sales tax to soda, and at least 17 states and three cities have proposed drink tax legislation in 2009-2010, according to Yale University's Rudd Center for Food Policy and Obesity.

Advertisement
Advertisement
Advertisement