City Hall

Council Members Debate Soda Tax's Impact to Small Businesses, Low-Income Families

The council could vote on the tax as early as next week.

By Hayat Norimine May 30, 2017

Supermarket soda tax pixabay rethyp

Seattle council members will vote on the city's proposed soda tax as early as next week, but the legislation could still undergo some major changes before then. 

The excise tax—estimated to raise $23.4 million in 2018—has already dropped from mayor Ed Murray's originally proposed 2 cents per ounce to 1.75 cents per ounce, and now has a heavier emphasis on using the revenues for public health rather than educational programs. At Friday's special committee meeting, council member Lisa Herbold said she wants to advocate for a significantly reduced tax, one she said was "inherently regressive," to be more in line with other cities that have implemented a soda tax. 

"I still have really big concerns about the impact of this tax on both low-income people as well as small businesses," Herbold said. "I think a penny per ounce is a place where a lot of other cities have started, and I think that makes a lot more sense and it's something I can again internally, intellectually reconcile a little bit better."

Council members said they also want to continue the debate over whether the city should include diet drinks; Murray decided to include diet soda to make the tax more racially equitable, but health experts have said the city would get greater results if it excluded diet soda from the tax. (Trends show that soda drinkers shift to drinking more diet soda instead, city officials said.) Excluding diet drinks would, however, significantly reduce the city's revenues from $23.4 million to $14.8 million—and health experts have also acknowledged that diet drinks could also be unhealthy. The data just isn't there yet to conclusively determine whether diet soda has a detrimental impact on public health.

The tax excludes products made by manufacturers that have $2 million or less in gross revenues, and the ordinance includes $1.5 million set aside for jobs retraining in the event of lost Teamsters jobs. (Herbold also said she wants to extend that to any job that might be impacted.) But at the crowded public hearing Friday, Teamsters 174 leader Pete Lamb said the bill still unfairly targets certain businesses and family-wage jobs, and said it was "just another example of the war on workers in this country."

Other health and education advocates spoke in support of the contentious tax, while some criticized the bill for not requiring a public vote. Six jurisdictions have implemented a soda tax, three of which through initiatives. Dr. John Krieger from UW Medicine said in an earlier press conference researchers estimate that for every 10 percent cost increase on soda, there’s about 10-12 percent lower consumption.

Of the six—Mexico; Berkeley; three California cities Oakland, San Francisco, and Albany; Cook County, Illinois; Boulder, Colorado; and Philadelphia—most of them began with a tax of 1 cent per ounce. Philadelphia's is 1.5 cents, and Boulder's is 2 cents. Only two of the cities include diet beverages. 

Council members are discussing the tax again at another special meeting at 9am on Wednesday. 

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