The Pennsylvania Supreme Court is set to review whether the controversial Philadelphia sweetened beverage tax is legal. While the move was announced on Jan. 30, the court has yet to set a date for the hearing.
According to The Philadelphia Inquirer, opponents of the soda tax will argue it constitutes a double tax – an additional tax on something already taxed by the state – which is forbidden under Pennsylvania law.
The soda tax has also been called inconsistent by some opponents who note that high-calorie drinks that are at least 50 percent fruit or vegetable juice or milk are exempt.
Many local supermarkets and University-contracted businesses such as Gourmet Grocer, Tortas Frontera, and Houston Hall retailers have increased their sugary drink prices in response to the tax.
The 1.5-cents-per-ounce tax on sugary drinks, which went into effect last January, aims to raise funds for the city’s pre-kindergarten program, community schools, and parks, in addition to curbing high sugar intake among Philadelphians.
Philadelphia City Councilwoman Maria Quiñones-Sanchez and fellow councilman David Oh have questioned the necessity of a universal pre-kindergarten program and whether the city already has enough money to fund it. They have also argued that the sugar-sweetened beverage tax would negatively affect businesses.
“I have a Coca Cola plant in my district with 435 jobs that will be impacted,” Quiñones-Sanchez said to The Daily Pennsylvanian in 2016. “Any time you’re looking at an industry that could potentially shut down and move across the bridge, it’s my duty to protect those jobs.”
As stated in the Inquirer, the tax raised $78.8 million in its first calendar year, falling short of projections. The city, however, estimates the tax will bring in $92 million in the fiscal year 2018.
In 2016, Wharton professor Michael Sinkinson expressed concern that the tax would disproportionately affect lower-income communities.
“Taxes don’t necessarily affect everyone equally,” Sinkinson said to the DP. “When you impose a consumption tax, or any sort of a sales tax, there’s concern that it might be regressive, and that it would actually have a larger effect on lower-income individuals.”