The city of Philadelphia tried to sugar-coat it, but the first big-city soda tax in the country is not sitting well with the town’s residents. Philadelphians are not happy with the 1.5 cent per ounce tax which can add up to several dollars on even single purchases of packs and larger bottles.
David McCorkle, CEO of the Pennsylvania Food Merchants Association, said: “The magnitude of this tax is historic and Philadelphian consumers can’t afford it.” In a photo that went viral after being posted on Facebook, a receipt shows over $3 in tax added to the cost of a $5.99 12-pack of Propel. The tax applies not only to sodas, but also to energy drinks (such as Propel), zero-calorie diet beverages, juice, and even milk substitutes for those who are lactose intolerant.
Jim Kenney, Philadelphia’s Mayor, originally proposed the tax last March; it passed the City Council 13-4. The levy, which took effect January 1st, is intended to be used to fund things such as libraries, parks and recreation centers, and the city’s pre-K programs. Kenney spokesperson Mike Dunn, not giving it to the citizens straight, told FoxNews.com that it isn’t technically a sales tax. He said: “The Philadelphia Beverage Tax is a tax on the distribution of sweetened beverages intended for retail; it is not a sales tax to be paid by the consumer and collected by the retailer.” This absurdity is typical of government bureaucrats who have no understanding of basic economics. When you set the rules and don’t have to play by them, you end up acting like a parasite, not a host.
The mayor’s office further illustrated its ignorance and condescension by stating that dealers and distributors could choose whether to increase prices: “Since it is not a sales tax, distributors…do not have to pass it down to their customers, the dealers. They could choose to slightly lessen their seven-figure bonuses, for example.” The distributors have to pay the tax, contributing to the overall cost of providing the product, which then largely determines the price of the product, dumb-asses. Those arbitrarily taxed could choose to make less margin then those not charged with (directly) paying it, but that would make them more likely to cut pay, eliminate jobs, or go out of business, thus reducing the tax base. Funny, those in public office, elected or otherwise, never seem to want to reduce their yearly compensation, or their retirement packages. And they don’t make things, they take them.
Both the real reason(s) for- and the ultimate result of- this tax are too obvious to require elaboration to anyone who is familiar with bureaucrats and economics. The mayor’s office itself proudly states that it has established a “Healthy Beverages Tax Credit” to help smaller stores that may see a downturn in their sales because of the new tax. This credit will be gallantly offered to “qualifying merchants who increase their inventory of healthy beverages.” How sweet.
So, even though the City of Brotherly Love’s leaders don’t think the tax should have any effect on retailers or consumers, they are offering tax credits to those retailers who stock healthier drinks? Both the tax credits and retailers carrying a higher percentage of healthier beverages (not subject to this tax) would decrease the amount of tax revenue the city fathers and mothers claim is so desperately needed. Truth-be-told, they really want to control people’s lives and dictate what they can and can’t do…and drink. Many in government crave this power for its own sake (maybe it’s like a “sugar high” to them), others truly believe they know what’s best for everybody else, too.
Of course, the end result of this tax will be that the city’s rascally and intransigent consumers will go elsewhere to shop. And, when they are shopping in nearby towns unaffected by this tax, they won’t just buy soda. The city of Philadelphia may see sales declines in areas other than soft drinks. And that may be a bitter pill to swallow.
Well, you know what they say: “A spoonful of sugar helps the medicine go down.”