SWEETENED BEVERAGE TAX (SEATTLE)
Beginning Jan. 1, 2018, the City of Seattle will impose a sweetened beverage tax. View Ordinance 125324.
The sweetened beverage tax is a tax on the distribution of sweetened beverages in the city of Seattle. The tax is collected on the final distribution of sweetened beverages by a distributor. The tax is not collected by the retailer nor is the tax burden intended to fall onto the consumer. The intent of the sweetened beverage tax is to tax the distributions of sweetened beverages into Seattle for retail sale in Seattle.
For more information, please review:
- Sweetened beverage tax frequently asked questions
- Seattle business tax rule 5-953 (includes illustrative examples for distributors, restaurants and grocery stores)
- Seattle Municipal Code Chapter 5.53
If you have questions or concerns, contact SweetenedBevTax@seattle.gov.
The standard tax rate for the sweetened beverage tax is $.0175 per ounce. There is a reduced tax rate for certified manufacturers. That rate is $.01 per ounce. ***Editorial comment by RushBabe49: Which manufacturers in Seattle will voluntarily pay that exorbitant tax on their legitimately-produced soda? Might those businesses simply write off Seattle and move their factories outside the city? If they do, how much B & O tax revenue will Seattle be losing?
Guidelines to follow
Distributors are liable for the sweetened beverage tax on distributions of sweetened beverages into Seattle for retail sale in Seattle. Distributors need to file the sweetened beverage tax online at https://www.filelocal-wa.gov/. Distributors will either file annually or quarterly; following the same schedule as its B&O tax filing due dates. The imposition of the tax does not begin until Jan. 1, 2018. For quarterly tax filers, the first due date to remit the tax will be April 30, 2018.
Exemption from the sweetened beverage tax
If a distributor sells products from a certified small manufacturer (annual worldwide gross revenue of $2 million or less), those sales are exempt from taxation. The manufacturer must apply for the exemption with the City.
Reduced tax rate
If a distributor sells products from a certified manufacturer that has worldwide gross revenue of over $2 million but less than $5 million, those sales are eligible for a reduced tax rate ($.01/ounce). The manufacturer must apply for the reduced rate certification with the City.
For a listing of sweetened beverages that are exempt from the sweetened beverage tax, please see Seattle Rule 5-953.
The intent of the Redistribution Certificate is to ensure that the tax only applies to distribution of sweetened beverages for retail sale in Seattle. Retail businesses that receive distributions of sweetened beverages in the city of Seattle but then redistribute some or all of the sweetened beverages for retail sale outside the city may issue redistribution certificates to distributors. The retailer then becomes responsible for remitting the tax to the City only on those sweetened beverages receipted and sold at retail in Seattle. ***Editorial Comment from RushBabe49: Just read this paragraph-can you imagine the labor involved in determining when this rule applies? What distributor will do this?***
In accordance with Seattle Rule 5-953 Sweetened Beverage Tax, this certificate may be completed by a person who requests to the distributor that they be liable for the sweetened beverage tax on sweetened beverages ultimately distributed for retail sale in Seattle.
Any distributor that accepts a Redistribution Certificate must provide a copy of the completed certificate to the City of Seattle within 15 days of receipt and the distributor will receive a confirmation of receipt from the City. The Redistribution Certificate is only valid with a confirmation receipt from the City of Seattle.
Distributors that accept a Redistribution Certificate must remit a copy by fax to (206) 684-5170 or by email to firstname.lastname@example.org.
Read the code
You can read the Seattle Municipal Code (SMC) for legal details about the sweetened beverage tax.
SMC Chapter 5.53 covers the sweetened beverage tax.
Seattle business tax rule 5-953 provides further information.