Lawmakers in the county encompassing Chicago have started the rollback of a controversial penny-an-ounce tax that went into effect Aug. 2 on sweetened soft drinks, calling it a nightmare for consumers and businesses alike.
The Finance Committee of the Cook County Board of Commissioners voted 15-1 this afternoon to report out a bill to the full legislative body that would end the tax on Dec. 1, the start of the jurisdiction’s fiscal year. That vote is scheduled for tomorrow.
The leading proponent of repeal, Commissioner Sean Morrison, issued a statement Friday that says he has enough votes on the board to override an expected veto of the tax-killing bill by President Toni Preckwinkle.
The news will likely be welcomed by restaurateurs in the many areas that are considering a soft drink tax, a measure advocates laud as a means of curbing obesity and simultaneously raising revenues for social programs. In Berkeley, Calif., where the first soda tax was adopted, sales of sugared soft drinks dropped by 21%, while sales in adjacent areas rose 4%.
Philadelphia; Seattle; San Francisco; Boulder, Colo.; and Albany, Calif., have also approved soft drink taxes.
Cook County’s measure was different from most of the levies in several ways. The tax applied to diet drinks made with zero-calorie artificial sweeteners as well as sugared sodas. Proponents also pitched it in large part as a revenue-raising measure with potential health benefits, a reversal of the argument for passage in other areas.
The tax applied to fountain drinks as well as canned and bottled sodas.
Several commissioners who voted for levying the tax say they now champion repeal because of an outcry from constituents. The surcharge left Chicago with some of the highest drink taxes in the nation.
Local news reports also noted an outcry from businesses that depend on soda sales, saying consumption had fallen. Sandy Douglas, president of Coca-Cola’s North American operations, cited a drop in restaurants in particular, noting that consumers were shifting their purchases to unaffected areas to forgo the surcharge.
Proponents of the tax point out that the measure will raise about $200 million in revenues annually for Cook County, the nation’s second most populated, with about 5.2 million citizens. Preckwinkle has said she would seek an 11% across-the-board cut in the budget for fiscal 2018 if the levy is dropped.
At least one Cook County commissioner has suggested that the shortfall be closed by legalizing the recreational use of marijuana instead of keeping the drink tax.
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.