Judge Dismisses Anti-Soda Tax Lawsuit

It’s a huge loss for the American Beverage Industry, a lobbying group that had filed the lawsuit as a last-ditch effort to prevent the tax.

istockphoto.com NoDerog

istockphoto.com NoDerog

A Common Pleas Court judge has dismissed a lawsuit filed by the American Beverage Association in September as a last-ditch effort to halt the soda tax passed by the city in June.

It’s a whopping, conclusive loss for the American Beverage Association, which spent roughly $10.6 million this year lobbying against the 1.5-cents-per-ounce tax on most sugary and diet beverages, which is expected to bring in $91 million to fund pre-K, community schools, park and recreation systems and the city’s fund balance. It’s a huge win for the Kenney administration – now the first city administration to levy a soda tax.

Common Pleas Court Judge Gary S. Glazer dismissed the lawsuit in its entirety today.

The American Beverage Association and several local residents and business owners who joined the organization in filing the lawsuit had claimed that the tax was unconstitutional. They argued that the levy essentially caused double taxation, as soft drinks are already subject to the Pennsylvania sales tax.

They had also argued that the tax violated the uniformity clause of the state Constitution – which requires similar products to be taxed equally – and that products purchased through food stamps of the Supplemental Nutrition Assistance Program could not be taxed.

The city had argued that because the Philadelphia Beverage Tax directly affects the distributor – not the consumer – it doesn’t count as a sales tax.

This is a developing story.

Follow @ClaireSasko on Twitter.

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