San Francisco joins sugary drinks fray with tax proposal

Reuters

By Laila Kearney

SAN FRANCISCO, Oct 29 (Reuters) - San Francisco may becomethe latest U.S. city to try to curb the consumption of sugarydrinks with a proposed ballot measure to impose a tax onbeverages seen as a culprit in rising rates of childhood obesityand diabetes.

Supervisor Scott Wiener on Tuesday formally proposed askingvoters in November 2014 to impose a 2-cents-per-ounce tax onsoda and other drinks with added sugar sold in the famouslyliberal northern California city.

No other U.S. city has enacted such a tax, though a similarproposal is in the works in the southwestern Colorado town ofTelluride, according to the Rudd Center for Food Policy andObesity.

Two other California cities, Richmond and El Monte, failedlast year in their attempts to become the first in the nation toimpose taxes of a penny per ounce on businesses that sell sugarydrinks.

In New York, Mayor Michael Bloomberg last year spearheaded aban on the sale of large, sugary drinks last year, but the movewas later declared illegal by a state judge after a challenge bysoft drink makers and a restaurant group. New York's highestcourt has agreed to hear an appeal.

"We know that this will be a long road," Wiener said inintroducing the measure to his colleagues. "This type ofproposal has occurred in other cities and the beverage industryalways comes out full guns blaring, so we're going to need topull together to make sure that this wins."

A ballot measure would need two-thirds support from votersin order to pass.

Wiener said his proposed measure would reduce theconsumption of sugary beverages while specifically setting asideproceeds of the tax for physical education and health programs.

"Voters really want to know where their tax money is goingto go," he said.

In both Richmond, located in the San Francisco Bay Area, andEl Monte, located east of Los Angeles, revenues from theproposed taxes would have gone to each city's general fund.

'WASTEFUL DISTRACTIONS'

The tax would amount to an extra 24 cents per average12-ounce (35 cl) can of soda. Wiener said it would bring in anestimated $30 million in tax proceeds annually. It would applyto drinks with added sugar and at least 25 calories per ounce.

A third of the expected tax windfall would go to SanFrancisco schools for physical education and healthy lunchprograms, and the remainder would go to city parks andrecreation programs and community health organizations.

Roughly two out of three California voters surveyed in aField Poll last fall and released in February said they wouldsupport taxing sugary beverages if proceeds were tied toimproving school nutrition and physical activity programs. Thepoll of 1,184 voters had a margin of error of plus or minus 3percentage points.

Wiener's proposal will go to a city Budget and Financesubcommittee for a hearing in the spring.

The board would vote between May and July on whether to addthe tax measure to the city's elections ballot, Wiener said.

A spokesman for the American Beverage Society said raisingtaxes and restricting drink consumption would not necessarilylead to a healthier population.

"Californians have rejected beverage taxes like the one SanFrancisco Supervisor Scott Wiener proposes because such measuresare unnecessary, wasteful distractions from seriouspolicymaking," spokesman Chuck Finnie said in a statement.

The society, which represents industry leaders includingPepsiCo Inc and Snapple Group Inc, has spentmillions of dollars fighting proposed soda taxes around thecountry.

"Providing people with education, opportunities for physicalactivity and diverse beverage choices to fit their lifestylesare proven strategies for maintaining health," Finnie said.

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