Behind the Scenes of Michigan’s Prohibition Against Local Tax Ordinances

How several groups worked together to prohibit cities and counties from passing soda and food taxes.

October 17, 2017

WEST BLOOMFIELD, Mich. – Michigan Gov. Rick Snyder is poised to sign a bill that bans local governments from slapping taxes on food, gum or soft drinks. The measure came about largely because of a push by the Associated Food and Petroleum Dealers (AFPD) and other stakeholders to stop any local tax ordinances of this nature at the state level. 

“We learned from the Cook County, Ill., experience that when a local ordinance is passed, it’s hard work to repeal it—better for state organizations to talk to their legislatures to get ahead of these issues,” said Auday Arabo, president/CEO of the AFPD. Cook County had approved a tax on soda in August, but repealed it last week.

Arabo and his company worked with a coalition of stakeholders to pass the Michigan bill to protect its members from such a patchwork of laws. “We decided we needed to be at the table when lawmakers were trying to decide on issues like beverage taxes so that we could provide a holistic approach to those issues,” he told NACS Daily. “We wanted to get proactive on this issue, especially after the Cook County debacle.”

He pointed out that these tax issues aren’t going away as states and localities look for alternative funding sources. “If we don’t bring solutions to the legislature about these issues, the lawmakers will decide what’s best—which usually isn’t what’s best for us as an industry,” Arabo said.

Read more on how beverage taxes are percolating at the local level in the October 2017 NACS Magazine cover story, “A Costly Pour.”

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