Philadelphia passed a soda tax on Thursday in a 13-4 vote by the city council. Starting in 2017, the tax will charge an extra 1.5 cents per ounce of soda purchased. The tax applies to soda, as well as drinks with artificial sweeteners and sugars. Milk, baby formula and beverages made with at least 50 percent fruit are exempt from the tax. Beverage distributors would be taxed, which could increase the price of a 12-ounce soda can by 18 cents and the price of a 2-liter bottle by $1 in Philly.
Berkeley, California is the only other major city with a soda tax. Since 2009, proposals to create a soda tax in more than 30 other cities (including twice in Philadelphia) have been rejected. Opponents argue that the tax discriminates against poorer people disproportionately and would be expensive for consumers. Soda and beverage companies are the most opposed to the soda tax, naturally, and some are filing lawsuits against the city. They predict the tax will cause sales to drop by as much as 50 percent, leading to layoffs in the beverage industry.
“The tax passed today is a regressive tax that unfairly singles out beverages, including low- and no-calorie choices,” said the American Beverage Association in a statement. Before the tax was passed, the beverage industry spent around $5 million to block it, according to ABC.
Philly’s estimated $91 million tax revenue would be put towards funding pre-kindergartens, rec centers, community schools, parks and libraries. Instead of pushing the tax to help encourage healthy eating, Democratic Mayor Jim Kenney declared that the purpose of the tax would be to help fund programs and projects to better the community.
“It’s been generations we’ve been going downhill with our kids in our neighborhoods,” Kenney said. “And it’s going to take some time to get us back. But this is the first step back.”