By Alex Lloyd Gross
The Beverage Tax is proving itself to be very unpopular among people who now realize how much their soft drinks will cost in the city. Even though a Federal Judge has dismissed the claim by the American Beverage Association , there is an appeal and this could wind up costing the city more money than it takes in during the first year of the Beverage Tax . The Laua and John Arnold Foundation just gave the city $500,000 to use in it’s legal defense to keep the soda tax going.
The Arnold Foundation is located in Texas. “We don’t think that the citizens of Philadelphia should be forced to abandon an intervention…that could benefit their city because of litigation said Kelli Rhee, vice president of the foundation said. The city did not ask for nor solicit this money. The Arnold Foundation does give handsomely to organizations to improve health of people. They are against sugar consumption and have come out in favor of this tax.
According to city spokesman Mike Dunn, he said that “Many residents are thrilled to see the expansion of Pre-K, Community Schools and renovations to parks, rec centers and libraries being funded by the Beverage tax”. Dunn also stated in a response to an email question that “The City. as part of this initiative, has established a Healthy Beverage Tax Credit to help small stores and bodegas that feel they have been impacted by this tax”. The city has capped the limit of the tax credit at $2000.00 per store.
Opponents to the tax have vowed to fight tooth and nail. They want the tax repealed and have let their council members know that if they voted for this tax, they are voting to put them out of a job on election day. Others are incensed that people who do not live in the city are meddling in city business which does not concern them. As far as they are concerned, they are buying a legal product and big money should be spent to dissuade anyone else from thinking it’s a good idea to implement this for their town. They also have stopped buying their sugary drinks in the city and have now gone outside the city to make those purchases. Most of the people we spoke to could care less about Pre-K and are incensed that the city is only using a portion of the tax money for that purpose. You can read more here.
The tax has already cost multiple business money with lost sales. City leaders have said the tax was imposed on the distributor not the consumer. The claim the money should come out of the bonuses of the soda industry executives. Soda tax opponents have said that via social media “Anyone that thinks people will voluntarily give up money is a fool”. In city stores, soda sales have dropped to a trickle while suburban stores have seen their soda sales rise exponentially and have taken to imposing limits.
Just this week the city announced that the Cigarette Tax that was imposed previously has failed miserably to come close to revenue expectations. Judging by human nature, we can expect the same result from the city Beverage Tax , as consumption does not decline, only sales inside the city do. Assume for the moment that the Beverage Tax is left intact and should shopping trends continue as they are, where will the city get the money to fund Pre-K. and all of the improvements.
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