American Beverage Association Calls Philly 'Sugar Tax' Regressive

In a lopsided 13–4 vote Thursday, Philadelphia passed a 1.5-cents-per-ounce tax on sodas. The tax applies both to sugar-added soft drinks and artificially sweetened diet sodas. That would add $1.02 to the cost of a two-liter bottle of soda pop.

There’s already an 8 percent sales tax in Pennsylvania that is applied to soda, which may be classified as a “food” but is not tax exempt in Pennsylvania the way it might be in some states.

Related Link: Associated Press Reports Philly Will Approve Sugar Tax On Sodas

The money from the new tax is meant to fund pre-k education expansion, community schools and a reinvestment in city parks and recreation. The mayor is expected to sign the measure, although he opposed the original 3-cents-per-ounce tax.

Some experts question the efficacy of taxing one type of sugary beverage in order to battle obesity, while ignoring sugar-laden drinks like juices. The American Beverage Association called the tax regressive, as poorer Americans consume high amounts of soda and may be less capable of affording healthier options.

Stocks potentially affected include The Coca-Cola Company KO, PepsiCo, Inc PEP and Dr Pepper Snapple Group Inc. DPS.