Soda sales slide after Philadel­phia im­poses tax

Austin American-Statesman - - BUSINESS -

Less than three months into Philadel­phia’s new tax on sweet­ened drinks, the stakes have es­ca­lated: Bev­er­age mak­ers say the mea­sure is hurt­ing sales so much they need to cut jobs, while city of­fi­cials claim the moves are a ploy to get the tax struck down.

Some su­per­mar­kets op­posed to the tax are mak­ing a state­ment by print­ing out the added cost on re­ceipts and store shelves. The tax be­gan Jan. 1 and is levied on trans­ac­tions be­tween drink dis­trib­u­tors and re­tail­ers, but many gro­cers are pass­ing it on to drinks amid an “Ax the Bev Tax” cam­paign. One widely shared photo on so­cial me­dia shows a re­ceipt for a 12-pack of 16.9-ounce bot­tles of Pro­pel Water, which is ar­ti­fi­cially sweet­ened. The re­ceipt says the drinks cost $5.99, and the tax adds $3.04.

IGA su­per­mar­ket has put signs near af­fected drinks that say “Philadel­phia Sugar Tax Item,” with the price of a 2-liter of Coke go­ing from $1.99 to $3.

“I just can’t af­ford it,” said Mar­garet Atkin­son, who was shop­ping at the su­per­mar­ket this week. Atkin­son said she has switched to generic brands and is ask­ing a nephew in the sub­urbs to pick up soda for her.

Philadel­phia is among the first U.S. cities to im­ple­ment such a spe­cial per-ounce tax.

While of­fi­cials touted it as a way to raise money for pre-K ed­u­ca­tion — not as a health mea­sure as in other cities — some ad­vo­cates also hail it as a way to fight sug­ary drink con­sump­tion and obe­sity.

In Philadel­phia, Pep­siCo says sales are down 40 per­cent com­pared to a year ago since the 1.5-cent per ounce tax took ef­fect, and it will need to cut 80 to 100 work­ers. A Canada Dry bot­tler says sales are down 45 per­cent and it had to lay off about 30 em­ploy­ees. Wake­fern, a co­op­er­a­tive whose mem­bers own ShopRite stores, also says over­all sales at Philadel­phia lo­ca­tions are down as much as 25 per­cent.

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