Seattle Liberals-stuck on stupid with their Sweetened Beverage Tax

On January 1, Seattle initiates a new “sweetened beverage tax”, of $0.0175 per OUNCE of sweetened beverage (Coke, Pepsi, Simply Lemonade, VitaminWater…).  Below is information I copied off the City of Seattle Web site.  Now, the reason for this tax in the first place is to make the citizens of Seattle healthier by making it more expensive to drink those evil sweetened beverages.  Except that…wait for it…they say below that the tax is NOT INTENDED TO BE PASSED ON TO THE CONSUMER!
Now, what are the chances that the beverage distributors will simply eat the huge cost of this tax?  Yes, about zero.  They will certainly pass the cost on to the retailers who stock the beverages, who will increase the cost to consumers.  The tax will about double the cost of a 21-ounce bottle of soda. **The tax on one 12-pack of 12-ounce cans will be $2.52, which is about the wholesale price of that 12-pack!!!
Cook County (Chicago) tried this a while ago.  And you know what happened?  Well, citizens of Cook County simply traveled a few miles, across the county line, and bought their sweetened beverages in the suburbs and towns next door.  Distributors laid off employees, due to the reduced business within the city.  And the county made very little money from the tax.  So it was repealed.
Liberals always assume that when they levy a tax on an activity or a commodity, those subject to the tax will simply pay up.  Well, they don’t!  If you tax something, you get less of it, which liberals never seem to learn.  The city of Seattle states that the tax is not intended to be passed on to consumers, but they seem never to have heard of the law of unintended consequences.  When people get taxed, they tend to change their behavior.  When the price of cigarettes skyrockets in a municipality or state, cigarette smuggling skyrockets.  When the cost of a sweetened beverage doubles in the City of Seattle, I predict that citizens will simply make a run to the new Lynnwood Costco to stock up on Coke or Pepsi.  Costco even carries VitaminWater now, so they can save even more.  I wonder if Seattle will pass a new law outlawing the carrying of sweetened beverages across the city limits?  Another question: how much additional business will Seattle retailers lose due to this tax?   Probably few people go shopping just for beverages, so how much additional revenue will Seattle stores lose when residents simply do all their grocery shopping outside the city?
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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:

If you have questions or concerns, contact SweetenedBevTax@seattle.gov.

Tax rate

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.

Additional exemptions

For a listing of sweetened beverages that are exempt from the sweetened beverage tax, please see Seattle Rule 5-953.

Redistribution Certificate

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 sweetenedbevtax@seattle.gov.

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.

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5 thoughts on “Seattle Liberals-stuck on stupid with their Sweetened Beverage Tax

  1. Cook County suffered more blowback than that. There was already a sales tax on those beverages, and that tax revenue went down too.

  2. And the State of WA follows right along. On January 1, the state minimum wage goes up to $11.50 per hour, and employers are now required by law to provide paid sick leave. Want to guess how many fewer jobs the state will have next year?

  3. In 1998, as part of a low-carb diet, I gave up sodas, since I was an admitted Coke addict. Little by little, I lost my taste for sweet drinks. Now I drink only coffee, hot tea, unsweet iced tea, and water. Guess what? I am right now, 40 pounds overweight. Moral: Soda is a scapegoat; it is not a cause of obesity. The real problem is a sedentary lifestyle, but the Socialist nanny-state can’t TAX that… yet.

  4. Hello, Mr. Patriot, and welcome to my blog! I appreciate your comment, and I agree totally. I happen to be a Diet Coke with Lime addict, and at my advanced age (68) I’m just not interested in changing. I also do my best to stay out of Seattle as much as possible.

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