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A proposed statewide soda tax in California is facing an uphill climb.
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The plan has been targeted by beverage industry, which is fighting similar proposals in other states.
A hearing in the state Legislature in Sacramento is scheduled Tuesday afternoon to discuss the proposed tax, which targets sugary beverages that proponents say contribute to diabetes, obesity and other health conditions. It comes as Connecticut , Rhode Island and other states consider soda tax laws that could hurt big beverage companies such as PepsiCo and Coca Cola.
Already, a proposed measure to ban the sale of jumbo-sized sugary sodas, including 7-Eleven’s Big Gulps, was shelved from consideration in the California Legislature on Tuesday. It isn’t expected to be heard during this session. The bill, which was introduced in February, was opposed by the beverage industry and retailer groups.
A poll released Tuesday, which is funded by the American Beverage Association (ABA), found that 60% of likely 2020 voters in California oppose new state taxes on sugary drinks. The poll, conducted by San Francisco-based David Binder Research, found that 37% support the tax.
Democratic Assemblyman Richard Bloom of Santa Monica introduced Assembly Bill 138, which would tax soda and other sugar-sweetened beverages like teas, sports and energy drinks, and use the revenue to help fund programs to combat diabetes and other chronic health conditions. This marks the third attempt by Bloom to pass a soda tax, including a “health impact fee” measure on canned soda drinks that legislators voted down last year.
“Much like past behavior from tobacco companies, the soda industry has routinely spread misinformation and propaganda in its efforts to stop legislation like AB 138,” Bloom said in a statement Tuesday. “In fact, independent polls conducted in California and elsewhere have shown support for sugary drink taxes, and that support has been confirmed by the passage of numerous local levies.”
Added Bloom: “It is important to recognize that support is high among voters when sugary drink taxes are tied to programs like nutrition education and children’s health programs. Voters want to know that their taxes are being used judiciously and effectively, and we intend to make that happen.”
A Politico-Harvard poll conducted in 2017 found 57% of respondents support taxes on sugary drinks to help health and education programs. It also found another 39% were opposed to it.
The Assembly Health Committee is scheduled on Tuesday afternoon to hear testimony on the proposed soda tax and decide whether to advance the bill. The legislation faces several other hurdles.
Some have suggested that state legislators maybe wary of passing new taxes due to a political firestorm created after the 2017 passage of a gasoline tax increase. Orange County voters in June recalled a Democratic lawmaker from his state Senate seat. Sen. Josh Newman, whose seat was taken by a Republican, had been linked to a $52 billion transportation package, which included a 40% increase in the state’s excise gas tax as well as increased vehicle fees.
The beverage industry and its lobbyists have spent nearly $12 million in the last two years in California fighting proposed soda taxes or health warnings, the Los Angeles Times reported Sunday.
“We know that companies like Coke and Pepsi have followed the big tobacco playbook in how they try to buy political influence in Sacramento while targeting their products to kids,” said David Aizuss, M.D. president of the California Medical Association (CMA), which is one of the backers of the soda tax. “These bills would bring those insidious marketing practices to an end and help reduce the epidemic of diabetes, obesity and other health problems caused by sugary drinks.”
CMA estimates sugar-sweetened beverages account for nearly half of the added sugar in the American die. The California Dental Association also supports the proposed statewide soda tax.
A report by California’s nonpartisan Legislative Analyst’s Office last year said it “would expect a statewide sugary drink tax to lead to higher prices for the taxed drinks and lower consumption of those drinks.”
AB 138 proposes a fee of two cents per ounce on sugary drinks and concentrate sold or offered to retailers for sale in the state to consumers. According to LAO estimates, “a two cent per ounce tax likely would reduce consumption by 15% to 35%.”
“We are committed to working with the legislature on effective ways to address its budgetary and public health concerns and to ensure that food and beverages remain affordable for all Californians,” said Steven Maviglio, a spokesman for the ABA.
Voters in the city of Berkeley passed a soda tax in 2014, making it the first municipality in the nation to enact such a tax. San Francisco’s law requiring health warnings on sugary drinks was fought by the beverage industry and shot down in January by a federal appeals court.
Meantime, the beverage industry is fighting proposed state or local soda taxes in other parts of the country. For example, Connecticut Gov. Ned Lamont is backing a tax on sugary drinks that could bring in more than $160 million for the state.
In Pennsylvania, the ABA has spent more than $16 million in the past three years to fight a soda tax in Philadelphia championed by Mayor Jim Kenney. The beverage industry also is running ads targeting Kenney in his reelection bid for a second term and several members of the city council that voted for the tax in 2016.