June 10, 2017
Seattle Soda Tax: What Is The New Sugary Drink Tax, Could It Force Jones Soda To Canada?

A new Seattle soda tax could punish local companies like Jones Soda. The new Seattle soda tax, which local lawmakers state is a way to fight against the consumption of sugary drinks, will add 1.75 cents per ounce of each drink covered in the policy. Though it has been advertised as a sugary drink tax, there are odd exemptions to the policy at this point, including milk-based coffee drinks that may have more sugar in them than a typical can of soda.

What Is The New Seattle Sugary Drink Tax (Soda Tax)?

A report by the Seattle Times stated that the Seattle City Council on Monday (June 5) approved a new tax on distributors of sugary drinks such as soda pop. Staff reporter Daniel Beekman tried to provide readers with a lot of information about the new Seattle soda tax, but there were already holes in the proposal that still haven't been addressed by the Seattle City Council. Not everything was addressed during a meeting that appeared rushed.

Though it was brought up during debates on the subject, it appears that milk-based coffee drinks, like many of the ones featured at Starbucks, won't be taxed under this new policy. At the same time, local companies like Jones Soda, which prides itself on using natural ingredients, could get punished quite a bit under this new tax law. The exemption seems to stem from the inclusion of milk in those coffee drinks, which has been spared by the Seattle City Council.

What Beverages Are Exempt From the New Seattle Sugary Drink Tax?

Diet soda, baby formula, medicine, weight-loss drinks, and 100 percent fruit juices are all exempt from the new Seattle soda tax. As are drinks that are milk based, which seems to include lattes, despite many consumers adding several pumps of sugary syrups to add taste to the drink. In the original draft of the sugary drink tax proposal, the mayor had also exempted all barista-made coffee beverages but settled upon exempting just the milk-based ones.

What Does The Seattle Soda Tax Mean To The Cost Of Local Drinks?

If the current sugary drink tax remains the same, it will add 1.75 cents per ounce of every beverage covered by the policy. To put that into perspective, for a two-liter bottle of Coke or Pepsi, there is going to be an additional $1.18 in taxes added to it. While this is advertised as a tax on distributors of the beverages, that cost is going to be passed to the stores, which in turn will have to raise prices on consumers. That's where some smaller establishments could be put out of business due to the loss of foot traffic.

Where Is The Money From The Seattle Soda Tax Going?

A report by the Associated Press states that the money earned by the Seattle soda tax is to be used on nutrition and educational programs. Food bank programs will also receive funding from the tax, which adds roughly 21 cents to every can of soda sold in Seattle. Supporters state that this tax will only affect unhealthy products and that taxing them could help people in the community quite a bit. Opponents stress that it will be punishing lower-income families that purchase more sweet drinks.

The Seattle City Council and Mayor Ed Murray aren't going to delay putting this sugary drink tax in place. It will take effect in early July, almost immediately adding a tax of 1.75 cents on every ounce. Social media has seen quite a few negative comments from local residents directed at Seattle lawmakers, especially from voters who work in or run establishments that sell the products in question. Will the new Seattle soda tax cause local companies like Jones Soda to move production to Canada to avoid their business getting punished?

[Featured Image by Justin Sullivan/Getty Images]