Customers Shoulder 100% of Seattle’s Soda Tax

A new study found that those who consume sugary soft drinks are paying most of the tax, which went into effect last January.
January 11, 2019

SEATTLE – University of Washington researches determined that consumers, on average, paid 97% of the 1.75 cents per fluid ounce tax on sugary beverages, The Daily Caller reports. Seattle’s tax went into effect January 2018.
 
“We don’t know why, but they did see something similar in Berkeley,” said research team leader Jesse Jones-Smith. Berkeley, Calif., had passed a soda tax years before Seattle did.
 
The team looked at the cost of beverages at more than 200 locations in the city both before and after the soda tax. The researchers also used prices at a couple hundred stores outside of Seattle for comparison purposes. “The most important finding is that in the large grocery stores most of the tax is being passed through,” said Jones-Smith.
 
Smaller stores passed on 104% of the tax to consumers, while larger stores only shuffled 84% of the tax to consumers. In all retail environments, consumers paid 102% of the tax on soda, 84% on sugar-sweetened sports drinks and teas, 63% on sugary juice drinks and 62% on sweetened bottled coffee beverages.
 
The city received close to $17 million in soda tax revenue from January to September 2018. The researchers will continue to study the tax to see if it reduces consumption of sugar-sweetened beverages. Both Washington and California have passed laws prohibiting any new taxes on soda from being enacted, while the Pennsylvania Supreme Court upheld Philadelphia’s controversial tax on soda last summer.

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