Judge Dismisses Philadelphia’s Soda Tax Lawsuit

The beverage industry says it will appeal the decision to the Pennsylvania Supreme Court.

December 21, 2016

PHILADELPHIA – A judge dismissed the beverage industry’s lawsuit to overturn the city’s soft drink tax, Forbes reports. The city levied a 1.5-cent per ounce tax on sweetened beverages, which is earmarked to pay for expanded pre-K programs.

Judge Gary S. Glazer’s 14-page ruling dismissed the case “in its entirety.” “We greatly appreciate the thorough and timely consideration that Judge Glazer gave to this matter,” said City Solicitor Sozi Pedro Tulante. “The judge upheld the key points of our argument: the Philadelphia beverage tax cannot be considered a sales tax, and neither does it violate the uniformity clause of the Pennsylvania Constitution.”

The lawsuit had claimed the ordinance would tax Supplemental Nutrition Assistance Program (SNAP) benefits illegally because such benefits are exempt from sales tax. The beverage industry’s case also alleged that Pennsylvania would see revenue drop between $2.7 million to $7.8 million yearly because of fewer soft drink purchases.

Shanin Specter of Kline & Spector, counsel for the beverage industry, stated that they would appeal the ruling to the Pennsylvania Supreme Court. The city’s soft drink tax was enacted in June. Across the country this year,more localities passed taxes on sugar-sweetened beverages, including Albany, Calif.; Boulder, Colo.; Oakland, Calif.; Cook County, Ill.; and San Francisco.

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