In the News
Philadelphia Inquirer- January 4, 2017
Philly finds new tax not so sweet
Those ounces add up.
Philadelphia's 1.5-cent-per-ounce sweetened-beverage tax is now in effect, and stores across the city have jacked up prices, to the outrage of some thirsty customers.
"If we pay taxes, why does everything else have to be taxed too?" Xavier Harrell said outside the Wawa store at Broad and Walnut Streets on Tuesday afternoon.
Harrell, 21, of Center City, had stopped in to use the $5 remaining on a gift card to buy a quesadilla and a 20-ounce Sprite. He got some bad news at the register. The soda was $2.29 and he was over the card's balance. He put the drink back, paid for the food, and walked out.
"Now I've got to eat this dry ... salty quesadilla, and I've got to be thirsty?" he asked.
Harrell wasn't the only person left with a bad taste over the levy Tuesday. People posted receipts to Twitter complaining about the hike, which went into effect Sunday.
An employee at a 7-Eleven store near City Hall, who declined to be named, said he'd been "yelled at all day" by customers.
Those who fought against the tax, which will fund parks, recreation centers, and early childhood education, say the sticker shock was expected.
"Consumers in Philadelphia should not be surprised at the vast increase in product pricing," said Alex Baloga, vice president of external relations for the Pennsylvania Food Merchants Association. "Our industry as well as others who are subject to this tax have been warning about this for the past year."
The tax is levied on distributors and was intended to be covered by distributors, but Tuesday it was clear that plenty had passed the increase on to retailers, who in turn raised prices on the shelves.
Major beverage companies such as Pepsi, Coca-Cola, and Canada Dry sent invoices to customers showing the price jump that stores could expect.
At a ShopRite in Northeast Philadelphia, a $5.99 10-pack of Propel flavored water sold for $9.75 after a $3.04 add-on for the beverage tax and 72 cents for state sales tax.
A case of Gatorade went from $20 to $30 at Nicoletti Beverage Center in Tacony. Nicoletti also raised the price of cans of soda from 50 cents to $1.
Michael Nicoletti, co-owner of the distribution center, which also sells beer, said that given the store's proximity to Bensalem in Bucks County, he would likely stop selling sodas and sweetened beverages.
"People can just go up the street," Nicoletti said. "It's just a nightmare. I don't know if they realize what they've done."
City spokesman Mike Dunn noted that the tax applies only to products purchased from distributors after Sunday, so at least right now, some of the increase could be premature.
"It is unlikely that every sweetened beverage sold to consumers by supermarkets or other dealers in the first few days of the month were purchased by that dealer after Jan. 1," Dunn said. "Consumers should be wary of signs that claim their supermarket had to pay extra for that product."
Bertolino's Pharmacy in South Philadelphia was increasing prices last week in preparation for the tax. Little Hug juices - the sugary, fruit-flavored kids' drinks that come in colorful 8-ounce barrels - went from 25 to 40 cents.
"A little kid comes in after school with a quarter to buy a Hug and now it's 40 cents," Tom Bertolino said. "It's a substantial difference to pay for a little kid."
Of course, for some people, the tax didn't prompt more than a shrug.
Robert Prather, 42, bought a Coke Zero and a bag of Combos at the 7-Eleven at Juniper and 13th Streets on Tuesday. He had no idea that the Coke had increased by 30 cents or that there was even a beverage tax on the books. He doesn't think it will change his twice-a-week soda habit.
"To be honest," he said, taking a swig from the bottle, "I didn't know anything about it."
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