Philly Soda Tax Appealed to Pennsylvania Supreme Court

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By Leslie A. Pappas

The American Beverage Association and a coalition of Philadelphia businesses have taken their fight against the city’s soda tax to the Pennsylvania Supreme Court ( Williams v. Philadelphia , Pa., Nos. 321 EAL 2017, 322 EAL 2017, petition filed 7/13/17 ).

In a petition filed with the state’s high court, the parties requested review of a June 14 decision by Pennsylvania’s Commonwealth Court that upheld the city’s 1.5 cent-per-ounce tax on sweetened beverages. If the decision is allowed to stand, “floodgates will open to all manner of duplicative taxes—subject only to the limits of local governments’ creativity,” the petition warns.

Unlike soda tax measures in other cities that apply only to sugar-sweetened drinks, Philadelphia’s tax applies to virtually all sweetened beverages, from diet sodas to sports drinks. The city hopes to use the revenue for an array of new programs and improvements to public spaces.

The Commonwealth Court’s ruling was the second to deny challenges by the coalition of business owners, retailers, and industry groups, including the American Beverage Association. The lower Philadelphia County Court of Common Pleas also found in favor of the city, and the Pennsylvania Supreme Court declined to hear the case in February. The coalition, which represents beverage makers such as Coca-Cola Co. and PepsiCo Inc., sued unsuccessfully in September to stop the tax, which went into effect Jan. 1.

‘Clear, Convincing Rulings’

The ongoing litigation may force children and seniors to wait longer for free pre-kindergarten programs, expanded community schools, and renovations to recreation centers and libraries, Philadelphia Mayor Jim Kenney (D) said in response to the recent filing. “It is unfortunate that the beverage industry continues to try to challenge the beverage tax despite two clear and convincing rulings by the Court of Common Pleas and Commonwealth Court,” he said in a statement emailed to Bloomberg BNA July 18.

In an emailed statement, the city’s solicitor, Sozi Pedro Tulante, said he remains “as confident today about the legality of the tax as I was before two separate Courts confirmed it.”

Friend of the court briefs filed in support of the business coalition include one from 36 Pennsylvania legislators, who argue the tax violates Pennsylvania statutory and constitutional law.

Former New York Mayor Michael Bloomberg, founder of Bloomberg L.P., has sponsored advertising and donated to groups that support Philadelphia’s soda tax. Bloomberg BNA is an affiliate of Bloomberg L.P., the global business, financial information, and news leader.

To contact the reporter on this story: Leslie A. Pappas in Philadelphia at LPappas@bna.com

To contact the editor responsible for this story: Jennifer McLoughlin at jmcloughlin@bna.com

For More Information

Text of the petition is at http://src.bna.com/qSA.

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