City Hall

Extra Fizz: Candy Tax Repeal to Cost City an Extra $500K

By Erica C. Barnett November 4, 2010

Under an initiative passed by voters Tuesday (I-1107), the state will tell retailers to stop charging sales tax on soda, candy, and bottled water (taxes that previously paid for state health-care and education programs). The city of Seattle just learned today that the rollback will happen earlier than previously expected---on December 1 of this year, rather than the beginning of 2011. The net result, council central staff director Ben Noble told council members just now, is that the city's 1107-related revenue shortfall will be $500,000 higher than expected---$3.4 million over the next two years instead of the $2.9 million council members previously anticipated. In addition to the loss of sales taxes, the city faces a revenue shortfall next year of $67 million.
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