Repeal of the penny-per-ounce sweetened beverage tax will take effect on December 1, 2017
By NACS Online
On October 11, the Cook County Board officially repealed the controversial city beverage tax. “The repeal was a foregone conclusion after the board’s Finance Committee voted 15-2 on Tuesday, signaling the pop tax would be scrapped after just four months,” wrote the Chicago Tribune. Repeal of the Cook County Sweetened Beverage Tax will take effect on December 1, 2017.
Wednesday’s voice vote came despite Board President Toni Preckwinkle saying that the $200 million she expected the county to collect from the penny-per-ounce beverage tax was necessary to avoid 11% across-the-board cuts, notes the Tribune.
Politico Pro reports that the 15-2 vote makes the repeal veto-proof. The fight to repeal the county’s beverage tax comes after strong support from former New York City Mayor Michael Bloomberg to keep the tax, and the American Beverage Association (ABA) and the retail community fighting to get rid of the regressive tax.
“We see this as a momentum swing,” Lauren Kane, a spokeswoman for ABA, told Politico. “People are just saying we want the government to find other ways to pay for their priorities rather than taxing working people.”
Since Cook County’s beverage tax was introduced, the Associated Food and Petroleum Dealers (AFPD) and local independent grocers had been fighting to repeal the tax. AFPD and its Illinois members were active in educating county commissioners and the public on the negative impacts of the beverage tax, including:
- Testifying how the beverage tax chased AFPD customers near the city and county limits across the Cook County border to purchase drinks in neighboring stores—losing not only the drink sale but other ancillary sales to stores in communities bordering Cook County;
- Testifying how the beverage tax decreased sales tax revenue at their Cook County locations due to “customer flight,” while increasing sales (and corresponding tax revenues) to neighboring localities just outside of Cook County; and
- Testifying how the current regulatory and tax structure of Cook County provides a significant disincentive to reinvest or expand operations in Cook County.
AFPD is a multistate trade association representing thousands of retailers operating in Michigan, Ohio, Illinois and surrounding states. Members include chain stores, independent supermarkets, convenience stores, petroleum retailers and specialty food markets, as well as wholesalers, distributors and manufacturers that support the retail industry.
“I would again like to thank Cook County Commissioners Sean Morrison and Richard Boykin for spearheading the effort to repeal this flawed tax, and all commissioners for listening to their constituents, both business owners and residents, in their support for Cook County Ordinance #17-4704. Sometimes localities go too far, and the pop tax is a great example of going too far,” said Auday Peter Arabo, Esq., AFPD president and CEO.
Read more on how beverage taxes are percolating at the local level in the NACS Magazine cover story, “A Costly Pour.”