Last updated on March 25th, 2021 at 07:23 pm
Massachusetts residents could pay a significantly higher tax on beverages with added sugar, such as soda and sports drinks.
Under review in the Massachusetts Legislature, Senate Bill 1562/House Bill 3329, authored by Sen. Jason Lewis and Rep. Kay Khan, seeks to create a tiered excise tax on sugary drinks, with tax level based on beverages’ sugar content. The proposal would levy a 24-cent tax on a 12-oz. can of soda; the burden would be even heavier on powdered drink mixes because the tax would be applied on a per-ounce basis once the beverage is mixed.
Massachusetts beverage industry representatives recently attended the Revenue Committee hearing to express their concerns about the legislation. The National Association of Convenience Stores quoted a consultant for the American Beverage Association, Kevin Dietly, who said that if the policy takes effect, the cost of a 4C Iced Tea mix would skyrocket to $17.92 for a product that typically costs $3.99.
Sen. Michael Brady, co-chairman of the Revenue Committee, said he is considering both health and economic vitality as he looks at the measures.
“Obviously we’re in support of getting people healthier…but you don’t want to hurt the employees in the working economy,” he told the News Service after the hearing.
In Philadelphia, which enacted its 1.5-cents-per-ounce tax on sugar-sweetened beverages in January, projected revenues from the tax are falling short of expectations.
“The city appears to be creating a short-term and long-term deficit through the beverage tax by not budgeting with true and accurate collection figures,” said outgoing Philadelphia City Controller Alan Butkovitz. “The School District of Philadelphia encountered a similar problem when it implemented the cigarette tax. Initially, the school district budgeted $80 million in the first year. Unfortunately, it never reached that figure and has been on a steady decline since, generating less than $50 million in the current year. Although the tax would generate about $77 million over the course of the year, that figure is well short of the projected $91 million annual figure the city is maintaining.”
But the legislation has its supporters as well.
“This legislation, if passed, will improve the financial health of our state and the physical health of our children,” said Bill Schmidt, vice chairman of the Winthrop, Massachusetts, Board of Health.
