The penny-per-ounce tax on sugar sweetened beverage in Cook County, Illinois, will be repealed following a 15-1 vote to do so by the Cook County Commissioners on Oct. 11.
The tax had only gone into effect Aug. 2, but the county’s Finance Committee recently said that it has become “increasingly clear” that the Sweetened Beverage Tax Ordinance, approved and adopted on Nov. 10, 2016, “is a regressive tax which will cause immediate and irrevocable hardship to businesses in Cook County and put those businesses in competitive disadvantage to businesses nearby.”
The Food Marketing Institute (FMI) released the following statement from Jennifer Hatcher, chief public policy officer, on the repeal: “We are pleased that the Cook County Commissioners heard the concerns of constituents and grocers and voted to repeal the county’s beverage tax. The loss of business caused by this burdensome and regressive tax, which has only been in effect since August, stunned local grocery stores and community members. Although the tax’s impact on local communities has been significant, we are inspired by the way Cook County residents channeled their outrage into an overwhelming grassroots response. We thank Illinois Food Retailers Association, Illinois Retail Merchants Association, American Beverage Association, Illinois Beverage Association and every store owner, associate and customer who spoke up against the tax. Because of these efforts, the repeal will take effect Dec. 1, 2017. We encourage food retailers and citizens facing beverage taxes across the country to continue to make their voices heard.”
Also expressing its approval, Teamsters Local 727, which represents nearly 2,000 beverage industry workers throughout Cook County, said the repeal “means that working families will no longer be required to pay an exorbitant amount of money for soft drinks, fruit juices and other beverages. It also means that Chicago-area beverage industry workers, thousands of whom are represented by Local 727, will no longer be at risk of losing their jobs as a result of the tax.”
It was estimated that more than 6,000 jobs could be shed by the industry because of the penny-per-ounce beverage tax. Lost wages were projected to be as high as $321 million for beverage production workers and delivery drivers. Cook County was expected to lose $1.3 billion in economic activity with businesses shuttered and consumers shopping beyond Cook County for groceries and beverages, the union said.
“Finally, the Cook County Board has done the right thing for millions of consumers and thousands of beverage industry workers in the metropolitan area,” said John Coli Jr., secretary-treasurer of Local 727. “From the first day this poorly-constructed tax plan was introduced, Local 727 remained committed to protecting hardworking Teamsters and their good-paying jobs. Our legislators need to pursue sustainable solutions to satisfy the budget without nickel-and-diming Cook County’s working families time after time.”
The union added that it has urged the Cook County Board to abandon similar beverage tax proposals, providing data on the detrimental effects such levies have had on workers and industry in cities like Berkeley, California, and Philadelphia. The Teamsters have asked lawmakers to consider other taxes, including rideshare surcharges, “which could meaningfully increase revenue over time.”
Local 727 represents workers at Pepsi, Coca-Cola Refreshments, Great Lakes Coca-Cola Distribution, Dr. Pepper Snapple and Home Juice.