Trade Group Vows Lawsuit Over Philadelphia Soda Tax

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By Casey Wooten

June 17 — One of the largest trade groups representing the beverage industry vowed legal action after Philadelphia's city council approved a 1.5-cent-per ounce tax on soft drinks.

“The tax passed today is a regressive tax that unfairly singles out beverages —including low- and no-calorie choices,” the ABA said in a statement released after the June 16 vote. “But most importantly, it is against the law. So we will side with the majority of the people of Philadelphia who oppose this tax and take legal action to stop it.”

ABA represents makers of non-alcoholic beverages, including the producers of sugary soft drinks such as Coca-Cola Co. and PepsiCo.

Though the tax impacts a single city, if successful, it could set off a domino effect in other cities and states considering similar measures such as Boulder, Colo. and Oakland, Calif.

“Such drinks are the perfect candidate for a tax: Besides raising revenue for valuable programs, a tax of this size can nudge consumption downward and reduce the regressive toll of soda-related disease,” the Center for Science in the Public Interest, an advocacy group backing the tax, said in a statement.

First Big City

Though Philadelphia is the first large city in the U.S. to pass a tax on artificially sweetened and sugar-sweetened beverages, Berkeley, Calif. passed a soda tax ordinance in 2014. (215 DER H-1, 11/6/14). Other cities, such as San Francisco and Richmond, Calif., have voted down similar ordinances. In June 2014, the New York State Court of Appeals rejected a New York City proposal to prohibit the sale of sugary drinks in bottles larger than 16 ounces.

To contact the reporter on this story: Casey Wooten in Washington at cwooten@bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com