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1 Courtney Shupert & Scott Drenkard, Soda Tax Experiment Failing in Philadelphia amid Consumer Angst and Revenue Shortfalls 1 (2017)

handle is hein.taxfoundation/sodatxph0001 and id is 1 raw text is: 




Soda Tax Experiment Fai ing


in Philadelphia Amid


Consumer Angst and


Revenue Shortfalls


FISCAL
FACT
No. 555
Aug. 2017


Courtney  Shupert
Research Assistant


Scott Drenkard
Director of State Projects


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@2017 Tax Foundation
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Key Findings:

  *   Philadelphia's beverage excise tax is 1.5 cents per ounce, which is 24 times
      the Pennsylvania excise tax rate on beer.

  *   The high tax rate on nonalcoholic beverages makes them more expensive
      than beer in some cases. Prior research on soda taxes suggests they are likely
      to drive consumers to more alcoholic beverage consumption.

  *   Philadelphia's beverage tax applies to diet beverages, despite those beverages
      having no impact on caloric intake.

  *   Beverage tax collections were originally promoted as a vehicle to raise funds
      for prekindergarten education, but in practice Philadelphia awards just 49
      percent of the soda tax revenues to local pre-K programs.

  *   Soda tax revenues are likely below expectations due to consumer mobility.
      Some soda consumers  may drive out of town to buy groceries, rather than
      pay the higher taxes.

  *   Poor revenue performance of Philadelphia's beverage tax threatens the
      sustainability of the programs it funds.

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