Seattle Soda Tax: Murray Proposes Reduced Rate, Adds Diet Drinks

SEATTLE, WA — Mayor Ed Murray on Thursday released an updated proposal to institute a Seattle soda tax. The new proposal reduces the overall tax rate and includes beverages such as diet soda, which were exempt in Murray's original plan. Murray says the tax would raise about $18 million per year, which would be spent on education programs ranging from adding teaching staff to setting up more after-school programs.

Although the tax would fund noble programs, soda taxes, such as those already in place in cities like Philadelphia and Berkeley, California, are often criticized as "regressive" because they burden lower-income people. According to the Centers for Disease Control, "Low-income persons consume more sugar drinks in relation to their overall diet than those with higher income."

Under Murray's new proposal, Seattle would tax soda drinks at 1.75 cents per ounce — that's a cut from the original proposal of 2 cents per ounce. However, the soda tax rate will be pegged to inflation. Beginning on Jan. 1, 2019, the rate will be reviewed each year and would increase with the consumer price index, according to the ordinance.

In its first year, Murray says the tax would generate $23 million, but that would drop to about $18 million in subsequent years due to fewer people buying sugary drinks.

Murray touted the tax as the answer to two problems: education funding and health.

"Seattle has the 5th-largest student achievement gap in the U.S.," he wrote in a Facebook post on Thursday. "More than 270,000 in King County experience food insecurity and challenges accessing healthy food. And the impact of health conditions brought on by consumption of sweetened beverages disproportionately falls on low-income residents and communities of color.

"Addressing equity in education and health are paramount challenges to ensure everyone has access to opportunity in Seattle. It's imperative that we proactively support Seattle Public Schools students and improved food access with frontline programs that put equity first."

The proceeds of the tax would go toward a number of programs, but a large share — a one-time $5 million investment — would go to the 13th Year Program, which funds one year of tuition at a Seattle Colleges institution. Another $5.7 million would go toward programs that foster education from birth to age 5.

A political opposition group called Keep Seattle Livable For All has been established to fight Murray's proposal. The group is comprised of about 150 Seattle business owners, from the owner of Judy Fu's Snappy Dragon to Seattle-based Jones Soda.

"It’s unfortunate that despite our efforts to engage the city leaders in a thoughtful discussion about our collective concerns, the city is determined to move ahead with a regressive tax that will substantially increase costs for consumers – in many cases doubling the price of these products," the group's spokesman, Jack Evans, wrote in a statement last week.

The ordinance would apply to essentially all carbonated soda or energy drinks, including diet sodas. Beverages exempt from the tax include milk (both animal and plant milk, like soy or almond milk); infant formula; sweetened medication; and unsweetened beverages that can be sweetened after ordering — for example, adding sugar or a sweetened syrup to a coffee or tea drink.

Read more about the proposal from the city of Seattle.

Patch file photo