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Pepsi Blames Philadelphia Soda Tax For Job Cuts

Last updated on March 2nd, 2017 at 04:46 pm

Pepsi said Wednesday that it is cutting 80 to 100 jobs in Philadelphia and laid blame on the city’s beverage tax that took effect Jan. 1. The layoffs reportedly will happen over the next few months and impact frontline and supervisory positions. Pepsi employs a total of 423 people in the area, where it has facilities in Northeast Philadelphia, South Philadelphia and Wilmington, Delaware.

“Our worst fears have been realized,” Teamsters Local Union 830 Secretary-Treasurer Daniel H. Grace said in a statement Wednesday. “(This is a) direct result of the city’s onerous and discriminatory beverage tax.

“PepsiCo reported a staggering 43 percent drop in business in the city since Jan. 1, 2017, the day the beverage tax went into effect. Canada Dry is also laying off 25 workers due to a sharp decline in sales because of the tax. Coca-Cola is planning a similarly bleak announcement in the near future. The carnage won’t end there.

“The Pennsylvania Merchants Association has already signaled that major layoffs of grocery store workers in the city are inevitable. This terrible news, although not surprising, is particularly disastrous for the members of Teamsters Local 830, who rely on a strong soda industry for their livelihoods.

“I cannot even begin to calculate the number of my members who now face unemployment as a result of today’s news. We predicted this dire outcome from the outset. We pleaded with city council members and our fellow union brothers and sisters in Philadelphia to stand with us against this outrageous tax, but to no avail. I hope they can live with themselves after knowing that their actions led to the devastation of an industry in the city and the loss of so many family-sustaining jobs.”

According to local news outlet 6abc.com, some of the revenue from the beverage tax is intended for pre-kindergarten programs in the city. City spokesperson Lauren Hitt told 6abc that PHLPreK has created 251 jobs.

Hitt said the soda industry has “sunk to a new low,” and accuses Pepsi of holding jobs “hostage” in an effort to overturn the tax, saying the company reported billions in profit last year, according to the news outlet.

“The idea that they can afford to do that but ‘must lay off workers’ should make every Philadelphian very skeptical of whether these layoffs are actually due to the tax,” Hitt said.

In late February, Mayor Jim Kenney announced that the beverage tax raised $5.7 million in January, more than double what city officials had projected.

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