Big Soda for the Win?

The U.S. beverage industry meets success in fighting soda taxes at the state level.

August 15, 2019

PHILADELPHIA—The U.S. beverage industry hasn’t been sitting idly by as municipalities like Philadelphia have passed soda taxes, Politico reports. From Pennsylvania to California, cities have implemented taxes on sugar-sweetened beverages.

After losing a Supreme Court case related to the Philly ban, the beverage industry switched its strategy and started advocating for individual state laws to quash any new soda taxes. The change proved surprisingly effective, with wins in Arizona, Michigan, California and Washington state.

The beverage industry makes two very simple arguments: That the health benefits of soda taxes are not as clear cut as supporters say and that such taxes harm small businesses and consumers. “We are definitely solidly behind preemption efforts because this is a very damaging tax to consumers, working families and small businesses,” said William Dermody, spokesman for the American Beverage Association (ABA).

The industry also brings retailers, supermarket associations and local farm bureaus together to support state bans on soda taxes. The American Heart Association and former New York Mayor Michael Bloomberg have mounted defenses against the strategy, but that hasn’t been enough to stop the beverage lobby, according to Politico.

“What the beverage tax has done is essentially made it very hard for those stores, particularly in poor urban neighborhoods, to succeed,” said Anthony Campisi, who has lobbied on behalf of Wakefern Food Corporation in Pennsylvania. He pointed out the natural alliance between the beverage makers and retailers like convenience stores. “It really does make it difficult to keep stores open in poor urban neighborhoods when there’s a massive tax on a core area of the business.”