City Controller: The Drop In Sales Due To Beverage Tax Is Greater Than City Had Planned

PHILADELPHIA (CBS) – Philadelphia City Controller Alan Butkovitz voiced his complaints with the city’s beverage tax following reports that revenue estimates are falling short of expectations, telling Dom Giordano on Talk Radio 1210 WPHT that the percentage drop in sales has surpassed what was planned for.

“What is the real impact of this going to be on the availability of food in the stores and these other issues in Philadelphia? First of all, when this tax was formulated, the city’s assumption was that they would cut soda sales in the city by 55 percent. They already took that into account when they said they were going to be making $7.7 million a month. Now, they’re 15 percent below those estimates. Right off the bat, that indicates that the cut in soda sales inside the city is well over 55 percent.”

Butkovitz believes the impact of that could be more far-reaching, even causing some stores to close or relocate.

“There are stores that have come in to the city in the last few years at great risk on relatively small profit margins in the inner city so that people don’t have to get their meals at McDonald’s, so that they can get a healthy assortment of food and they’re arguing that they are being pushed over the tipping point and that they may have to reverse what the city’s policy has been to get these people to come in and they may have to leave the city, leaving people high and dry.”

He also criticized how the tax was designed to target people who could least afford to absorb added cost to their budgets.

“It’s the opposite of the idea of taxing the people who can afford it to pay for these things. It’s a regressive tax. It’s very much like a sales tax and it’s always confusing to me how people describe themselves as progressives in Philadelphia because, often, to be a progressive in Philadelphia is the opposite of being a progressive in the United States. Progressives have always been in favor of income taxes over sales taxes, graduated taxes over matching it to people’s ability to pay and, in Philadelphia, they’re doing the opposite. They’re putting a disproportionate burden on people who just about have the money to make it through the week.”

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