Nebraska Considers Taxing Soda, Energy Beverages

A bill introduced this week would remove the soft drink exemption from the state's sales tax.

January 06, 2012

LINCOLN - Nebraska could soon end its sales tax exemption for soft drinks and energy beverages. A bill introduced by Sen. Bill Avery would shuttle the funds raised by removing the exemption to encourage healthy living among children, the Omaha World-Herald reports. The measure would generate an estimated $11.3 million annually.

Avery said his bill is a public health measure, that only food and medicine should receive sales tax exemptions. "Soda is not food. There's nothing in soda that can be classified as nutrition," he said. "This is not an additional tax. It is removing an expensive tax exemption."

As quick as you can open a can of soda, the Nebraska Grocery Industry Association and Nebraska Beverage Association both registered their opposition to the measure. "I don't think the State of Nebraska should tell its citizens what they can and cannot consume," said Kathy Siefken, a grocery association lobbyist. "I don't think you tax people into certain behaviors."

Siefken also pointed out that changing how soft drinks are classified would create more work for small stores. The legislation classifies soda as nonalcoholic drinks with natural or artificial sweetener, which would include energy drinks, juice drinks, regular and diet soft drinks, most flavored waters, and sports drinks. Exempt would be milk or milk products, rice, soy or other milk substitutions, and 100% fruit or vegetable juices.

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