Since the “sweetened beverages” tax has gone into effect in Cook County we’ve been absolutely deluged with public service announcements, funded by Michael Bloomberg, trying to convince Chicagoans to appreciate what their betters are doing for them. The tax adds a penny an ounce to the cost of a bottle of pop or, in an exercise in overreach to any beverage whether naturally or artificially sweetened—soda, sports drinks, flavored water, energy drinks, pre-made sweetened coffee and tea with less than 50% milk content, etc. That translates to $.72 a six pack or an additional $2.88 in tax per case.
If my dear local grocery store, Happy Foods, had a fidelity club, I’d be a member. I am a daily shopper and have been for more than 25 years so I am, consequently, a face familiar to the staff at the store.
The other day I was chatting with the store manager and she told me that since the tax went into effect soft drink sales across Cook County have declined by 58% county-wide. Since sales tax applies to soft drink sales in Cook County, that means a loss in sales tax revenue. I don’t know what the net effect on tax revenue might be but I suspect that less net revenue is being collected as a consequence of the tax than was anticipated by the County Board.
Keep in mind that the grocery business is a low margin one. A loss of revenue in an item like soft drinks is no joke for many retailers.
Lest you confuse a reduction in sales with a reduction in the consumption of sweetened drinks, in the same conversation the store manager revealed that she was buying her pop when she visited her daughter who lives in DuPage County where the tax does not apply. I don’t think I know anyone who isn’t doing the same thing.
So not only is the tax regressive its effect on health may be negligible as well. Oh well, you can’t make an omelet without breaking eggs. It would be interesting to know if the members of the Cook County Board were still buying drinks subject to the tax and where they were buying them.
Clearly what’s needed is a national-level tax to prevent the dodgers from escaping it….
Yeah, that’s gonna happen. It’s the bulk of Coca-Cola and Pepsi’s business on the line. The only thing the tax doesn’t apply to is bottled water and some places are taxing that. The primary beneficiaries of this ordinance will be plaintiff’s attorneys.
If it wasn’t clear, my comment was all sarcasm.
I’m genuinely sorry you have to life with such bad local government.
I don’t have to. We could afford to live anywhere we really cared to.
We chose to live in Chicago as an act of benevolence. If every honest person who can earn a decent living abandons Chicago, what will it be?
out of idle curiosity, is the tax applied on drinks bought with Food Stamps? In the early days, states found out quickly from the Federals that no sales tax could be collected on food stamp purchases.
As originally written it would have applied to purchases made with SNAP but the Board was quickly informed that was illegal so it was re-written. It’s still regressive, just not as regressive as it would have been as originally written.
Note, too, the burden the tax places upon retailers. They’ve got to code thousands of different SKUs for the tax, they’ve got to collect the tax only from non-SNAP purchases. The burden falls heaviest on the smallest retailers. My off-hand guess is that some will just not collect the tax and risk being fined while others will improperly collect the tax on all soft drinks.
Regressive, its won’t be paid by those with the willingness/ability to pay. This tax will be paid by those who won’t listen to their betters.
“If every honest person who can earn a decent living abandons Chicago, what will it be?”
A city on the road to learning the lesson all decrepit, corrupt single rule entities must learn, and one having a great hockey organization and a great baseball organization. The other sports monopoly, well, the Bears still suck, the Bears still suck…..
Chuckle! We had a soda tax put into effect in Richmond, just down the road a bit, last year. The effects seem to have been similar. Local soda consumption dropped, and people went elsewhere.
We also have had a statewide ban on cheap plastic bags, which turns out to be sort of bearable. Yeah, there’s a libertarian being clubbed in the testicles every time I fork over a dime for a fairly sturdy plastic bag, but …. weren’t libertarians dying out anyhow?
And also we’ve had attempts to wipe out smokers for some while. With not quite total success, although at times I look back and almost wonder how it was ever possible that I and many others not only smoked on the premises at work, but even in our offices with non-smoking fellow employees present. It seems a foreign land!
But my main observation is that restricting smoking in California has taken a quarter century of steadily restrictive laws — putting non-smoking clauses into rental agreements, for example — and ever higher taxes. Back in the late 90’s, I could buy a carton of off-brand cigarettes for just under ten bucks — today that’s the cost of a pack.
Has this reduced smoking in the state? Maybe. Probably. There are fewer people visible smoking in parks and outside buildings and so on, but there are an awful lot of people who keep an eye out and approach smokers with the idea of buying a cigarette.
Maybe you can reduce obesity with a sugar tax, but evidence suggests it can’t be done with small measures.