OPINION:
Soda taxes are making a comeback — and with it, jobs are being lost and city revenue targets are being missed as people pull back from buying the beverages.
In November, San Francisco, Oakland and Albany, California; Boulder, Colorado; and Cook County, Illinois, all passed soda taxes. Two years ago, Berkeley, California, passed a similar tax, one has been proposed in Seattle, and Philadelphia’s went into effect in January.
“There’s a momentum with these taxes that will be hard for the industry to stop,” Kelly D. Brownell, the dean of the Sanford School of Public Policy at Duke University, who first proposed a “sin tax” on junk food in 1994, told The New York Times. “I expect a year or two from now that the taxes will be widespread.”
The implementation of the taxes may be swift but not without fallout.
Earlier this week, Pepsi said it was laying off as many as 100 workers at three of its distribution plants in Philadelphia area because of the 40 percent drop-off in sales, which it attributed to the tax.
“Unfortunately, after careful consideration of the economic realities created by the recently enacted beverage tax, we have been forced to give notice that we intend to eliminate 80 to 100 positions, including frontline and supervisory roles,” spokesman Dave DeCecco said on Wednesday.
Two months after Philadelphia’s tax went into effect, supermarkets and distributors reported as much as a 50-percent drop in sales, and they said layoffs were planned.
One of the city’s largest distributors, Canada Dry Delaware Valley, said it would cut 20 percent of its workforce in March, and an owner of six ShopRite stores in Philadelphia said he expects to shed 300 workers this spring, according to a report from the Philadelphia Inquirer.
The city, which estimated 27 percent decline in sales, is facing backlash against the bill, as more jobs are lost and the revenue predicted from the tax looks to be falling short.
According to the Inquirer, the city needs to collect $7.6 million a month in tax revenue, and early projections from the city’s quarterly manager’s report predicts only $2.3 million will come through in the first collection.
This is nanny state politics gone wrong. As do-gooders try to enforce healthy policies on their constituents, real jobs are being lost.
“Our worst fears have been realized today,” said Danny Grace, secretary-treasurer for Teamsters Local 830, which represents many of the employees affected by Pepsi’s layoffs, in a statement. “This terrible news, although not surprising, is particularly disastrous for the members of Teamsters Local 830, who rely on a strong soda industry for their livelihoods.”
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