Philly Soda Tax Brings in Highest Collection Yet in March

istockphoto.com NoDerog

istockphoto.com NoDerog

The Philly soda tax brought in $7 million dollars in March, its third month in action, the Department of Revenue announced on Tuesday. The amount is the most the city has ever collected in a single month from the beverage tax.

The city collected $5.9 million for January, the first month, and $6.2 million for the month of February. The Department of Revenue says the March collection of $7 million is a preliminary figure and final numbers for the month will be available in May.

According to Philadelphia’s Five Year Plan released at the beginning of March, the city’s budget office projected that the tax would bring in $7.7 million each month until June, the end of fiscal year 2017. The preliminary figure falls below this estimate.

The Department of Revenue says it’s confident that it’ll reach the fiscal year 2017 collection goal of $46 million, which encompasses the first six months of the 1.5-cents-per-ounce sweetened beverage tax. For the full year, the city expects the tax to bring in more than $91 million. “We are satisfied with what has been a relatively smooth implementation and collection of the tax,” said revenue commissioner Frank Breslin in a statement. “Field investigators have found that a majority of businesses affected by the tax are compliant. We will continue our enforcement and compliance efforts to reach all those distributing sweetened beverages.”

To reach the $46 million goal for fiscal year 2017, the city still needs to collect about $26.9 million. That’s about $9 million in collections for the months of April, May and June. But Mike Dunn, a spokesman for the city, says the revenue department will be collecting funds for fiscal year 2017 well past the month of June. “Some of the payments that we receive after July 1 are actually related to activities that occur before the end of June,” Dunn told Philadelphia magazine. “All the [Philly Beverage Tax] payments received on July 20 will be related to activities prior to June 30, and some of the August revenues may also be attributed to before June 30.” 

The city says collections of the beverage tax are expected to fluctuate throughout the year because of factors like holidays, weather, and seasonal changes in soda consumption.

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Philly’s Soda Tax Is Back in Court Today

FILE - In this Wednesday, June 8, 2016 file photo, opponents of a proposed sugary drink tax demonstrate outside City Hall in Philadelphia. Philadelphia is set to become the first major American city with a soda tax despite a multimillion-dollar campaign by the beverage industry to block it. The City Council is expected to give final approval Thursday, June 16, 2016, to a 1.5 cent-per-ounce tax on sugary and diet beverages. (AP Photo/Matt Rourke, File)

Opponents of a proposed sugary drink tax demonstrate outside City Hall on June 16, 2016. (AP file photo/Matt Rourke)

On Wednesday, a panel of Commonwealth Court judges in Pittsburgh will hear arguments over the legality of Mayor Kenney’s landmark sweetened beverage tax.

Levied just four months ago, the soda tax brought in about $12 million in its first two months to fund key city initiatives including pre-K expansion, the establishment of community schools and the revitalization of city parks libraries and recreation centers. The city expects to bring in $92 million each year with the tax.  Read more »

Philly Soda Tax Draws in $6.4 Million for February, Exceeding City’s Estimate

istockphoto.com NoDerog

istockphoto.com NoDerog

The Philly soda tax brought in $6.4 million dollars in February, its second month of collections, the city announced Thursday morning. The figure exceeds Philly’s revenue projection of $5.9 million for February.

This means that so far, the Philly beverage tax has brought in a total of $12.3 million from its first two months. The tax garnered $5.9 million in collections in January, revised up from an initial total of $5.7 million. The city says totals will continue to fluctuate throughout the year due to consumption changes caused by events like holidays and weather.  Read more »

Temple University Blames Steep Meal Plan Hike on Soda Tax

Morgan Hall at Broad and Cecil B. Moore | Temple.edu

Morgan Hall at Broad and Cecil B. Moore | Temple.edu

Temple University officials plan to raise board rates by 4.8 percent for 2017-18 – and they say the soda tax is to blame.

The Inquirer reports that the sweetened beverage tax the city passed last year will cost the university $400,000 a semester, according to Ken Kaiser, the school’s chief financial officer.  Read more »

Citing Soda Tax, Pepsi to Lay Off 80 to 100 Philly-Area Workers

Pepsi bottling plant

A Pepsi bottling plant in Northeast Philadelphia | Image: Google Street View

Pepsi announced on Wednesday that it will lay off as many as 100 workers at its three Philadelphia-area plants. The company cited lagging sales due to the soda tax as the reasons for the layoffs.

The layoffs, per the Inquirer, will be spread out over the next few months. Employees will be axed from two plants in Philadelphia and one in Wilmington.

“The soda industry sank to a new low today,” city spokeswoman Lauren Hitt said in a statement released to the press. “They are literally holding hostage the jobs of hardworking people in their battle to overturn the tax. Pepsi reported nearly $35 billion in gross income and $6 billion in profit last year, their CEO makes $25 million dollars a year, and they along with the beverage industry continue to shell out hundreds of thousands of dollars on lobbyists and advertising against the tax.

“The idea that they can afford to do that but ‘must lay off workers’ should make every Philadelphian very skeptical of whether these layoffs are actually due to the tax.”

Others had different opinions, as you might imagine. Read more »

City Looks in Other Pocket, Says Soda Tax Revenue Is Actually $5.7 Million

Sodas for sale in a refrigerated case

Photo by Marlith (license)

In its first month, Philadelphia’s beverage tax has brought in $5.7 million, according to information released by the city’s revenue department on Thursday.

The figure more than doubles the city’s $2.3 million prediction for January, and officials expect the preliminary figure to increase once all tax payments have been processed. The current revenue collection for January still falls short of the $7.6 million monthly average the city must collect to meet its $91 million-a-year goal.

“The budget office’s projection of $2.3 million was intentionally conservative because this is a new tax, and it was difficult to determine the extent, if any, of issues that taxpayers would have in filing for the first month,” city spokesperson Mike Dunn told Philadelphia magazine.  Read more »

Soda Tax’s Early Impact: Sales Drops, Layoffs, and Lagging Tax Revenue

In the two months since Philly’s beverage tax was implemented, some grocers and drink distributors are reporting significant sales drops, and the city expects soda tax revenue for the first month to be well below initial projections.

Some local businesses are reporting sales drops as high as 50 percent and major layoffs that will continue into the spring. Bob Brockway, chief operating officer of Canada Dry Delaware Valley, which distributes about 20 percent of Philadelphia’s sweetened beverage, told the Inquirer that sales were down 45 percent and that they have plans to lay off 20 percent of its workforce — 35 positions, including salespeople, managers, and drivers — as a result. Read more »

State Lawmakers File Brief Against Soda Tax

Sodas for sale in a refrigerated case

Photo by Marlith (license)

Thirty-six state lawmakers have signed on to a brief opposing Philadelphia’s soda tax in Commonwealth Court. The Inquirer reported on Monday that the five state senators and 31 state representatives include three Philadelphia lawmakers: state Sen. Anthony H. Williams, state Rep. Angel Cruz, and state Rep. Martina White.

The beverage industry sued Philadelphia late last year over the soda tax, which applies a 1.5-cent-per-ounce tax to all sweetened beverage products sold within city limits. While the tax is applied to distributors, most retail outlets are passing the cost on to consumers. A judge threw out the lawsuit, but an appeal is pending. Read more »

ShopRite VP Responds to Accusations of Price-Gouging and Fraud

A 99-cent bottle of ginger ale becomes $2 at ShopRite. (Photo by Aria Fiorillo)

A 99-cent bottle of ginger ale becomes $2 at ShopRite. (Photo by Aria Fiorillo)

In the wake of the Philadelphia Beverage Tax — more commonly referred to as the Soda Tax — coming into effect, residents are fuming at both the city and at ShopRite, which seems to be one of the only major retailers prominently displaying the amount of tax added to an item, as seen in the photo above. Some have accused ShopRite of price-gouging and outright fraud — the chain was adding a surcharge to products that aren’t part of the tax — and of using the tax tags to make a covert political statement. Here, ShopRite vice president Karen Meleta responds. Read more »

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