In the News
Philly.com - March 31, 2016
Letter: Teamsters, other workers will suffer if soda tax becomes law
MAYOR KENNEY'S proposed 3-cents-an-ounce tax on sugary drinks is difficult to swallow, especially for the city's poor, small shop owners, grocers and the Teamsters Union drivers and bottling-plant workers I represent.
The regressive tax, which City Council already rejected twice under the previous mayor (including two "No" votes by former Councilman Kenney) is now being spun by the Kenney administration as the only way it can afford to pay for its ambitious new proposals, which is simply untrue.
Once again, Philadelphia's government is unfairly targeting one industry with such an onerous tax. If enacted, the sugary drink tax will disproportionately hurt hardworking, middle-class families and the city's working poor. City officials continue to exhibit an alarming lack of understanding of the economic consequences of this tax in dismissing the Teamsters' belief that the tax will cost our membership jobs in an already weakened beverage industry and a down national economy.
If this ill-considered tax is passed, the cost of sugar-sweetened drinks - soda, ice tea, fruit juice, sports drinks and energy drinks - will more than double in cost. People will stop buying the products in Philadelphia or drive to the suburbs to purchase them (much as they've done to avoid the city's cigarette tax). City stores will stop stocking the products; Soda companies will move fewer products; and Teamsters drivers and industry support personnel will lose their jobs.
Beverage industry statistics show that when soda prices rise 10 percent, sales drop 8 to 9 percent. Reductions in sugary-drink sales mean job losses, from bottling plant workers to Teamsters delivery drivers. Our best estimate at this point is potentially as many as 2,000 regional jobs lost if this tax is passed. Any projected job gains being touted by the city through the implementation of new programs funded by a sugary-drink tax will be more than offset by the many job losses brought about by this tax.
Philadelphians already are burdened with among the highest taxation rates in the country. When does it end?
And our concern isn't only about the adverse impact on Teamsters members. Supermarket employees, convenience store workers and small-business owners who sell sugary drinks in their stores or restaurants also will be affected if this outrageous tax is passed into law.
Thousands of family sustaining, middle-class Philadelphia jobs in beverage production, supply, distribution, sales and retailing depend on a healthy beverage industry.
The loss of any of these jobs will only further erode the city's tax base. Teamsters Local Union 830 represents more than 3,000 Philadelphia members in the soft-drink and brewery industries. These hardworking, taxpaying city residents do not deserve to have their jobs placed in jeopardy because of a misguided attempt to fund new programs solely by taxing the product they produce and deliver.
Worse still, the sugary-drink tax is discriminatory. Taxing one product and one industry, to the exclusion of numerous items containing similar sugar-based ingredients, is simply unfair.
The tax would not be imposed on snack items such as ice cream, candy, cookies, cupcakes, frozen pops, doughnuts or other high-sugar foods. Instead, this tax would unjustly target and burden the beverage industry alone.
It's also interesting to note that the consumption of sugary beverages nationwide has been steadily declining for several years.
Nowhere has that decline in sales been steeper than in Philadelphia, calling into question the accuracy of the revenue projections derived from the sugary-drink tax, as put forth by the Kenney administration. Philadelphia consumers simply are not drinking as much sugar-sweetened beverages these days.
You can bet the farm that if this burdensome tax becomes law, those consumers who still purchase sugary beverages will leave the city limits to buy it.
On behalf of more than 3,000 Teamsters, many of whom live and work in Philadelphia and are dependent on the beverage industry for their livelihoods, I respectfully ask the members of City Council to vote against the sugary drink tax. It will be an additional financial burden on families and small-business owners already struggling to make ends meet.
Daniel H. Grace
Teamsters Local 830, Philadelphia
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