soda taxes

Seattle Is America’s Latest City to Tax Sugary Drinks

The perpetrators are all lined up. Photo: David McNew/Getty Images

Seattle officially joined America’s municipal-soda-tax club yesterday, passing a measure that adds 1.75 cents per ounce to the price of sugary drinks in the city. It’s the nation’s second-highest rate (Boulder is the only local government to go for a full two cents); everybody else’s tax is 1.5 cents or less. That means that starting in July, residents will pay what amounts to an extra $1.18 for every two-liter bottle of soda. Per usual, the levy is being assessed on distributors, but they always pass it on to consumers. In addition to sodas, Seattle’s tax also applies to Gatorade and other sports drinks, energy drinks like Red Bull, and fruit drinks that aren’t 100 percent fruit juice. Diet drinks are exempt.

The bill passed 7–1, which is kind of a burst of wind in the soda-tax movement’s sails. Lately, it’s run into a few hiccups: Last month, voters in Santa Fe resoundingly rejected a proposed tax on sugary drinks citywide, and Philly’s tax has managed to both upset residents at its ubiquity and fall short of the revenue it was predicted to bring in (although those aren’t necessarily mutually exclusive). Initial estimates said the tax would bring in $46 million for the fiscal year 2017, but the number will probably wind up being about $20 million shy of that goal, according to a preliminary report released by the city.

The big debate with Seattle’s tax was whether to tax lattes sweetened with syrup. The new law exempts milk drinks, but obviously not sugary syrups. This put sweetened lattes in weird limbo — even though a lot of Seattleites were horrified at the thought of a tax on PSLs and Frappuccinos in the birthplace of Starbucks. The Seattle Times says the final version remains vague on the matter, although one City Council member tells the paper it’s her understanding that lattes won’t end up being taxed.

Seattle Is America’s Latest City to Tax Sugary Drinks