Local Legislators Suggest Syrupy
Hard Facts About
Soft Drink Taxes
by Belinda Judson
Executive Director, Mid-States NATO
We predicted that 2004
would be a very “taxing” year
in statehouses across the country. As part of their efforts
to help rectify budget deficits, lawmakers in many states
have found it very attractive to propose new or increased
excise taxes on soft drinks.
Fortunately for us, NATO
and the regional NATO affiliates have many allies who
are most helpful to us when we are
faced with legislative battles. These good partners include
the National Soft Drink Association (NSDA) and its members.
Because we expect more
activity in states that have not yet seen this issue
arise, and also feel that in the
future it will return to the legislative agenda in
it has already been defeated, we thought it would be
helpful for exhibition professionals to have more information
John Steele, director
of state and local affairs for the NSDA, has been kind
enough to share his thoughts
the issue. Some exhibitors have already worked with
him, as he has been very diligent about calling on
NATO affiliates to team with his members in efforts
to defeat proposed legislation in several states.
“Across the country
the soft drink industry and its customers are prime targets
for excise taxes,” he notes. “In
2003, a year with record state budget deficits, soft drink
excise tax bills were proposed in 11 states, and all were
defeated. The budget situation is no better in 2004 and
already this year soft drink tax bills have been introduced
or are expected in Alabama, Indiana, New Mexico, Oklahoma,
and West Virginia, and more states may follow.
try to improve their chances of success by promising
to dedicate funds to popular causes like Medicaid
programs, medical research, highway construction,
and teachers’ pensions.
But the industry and most voters are skeptical that the
money would actually be spent that way.
“A typical tax proposal
would cost $2 per gallon of syrup or 2 cents per bottle
or can sold; the tax burden on a
fountain serving is generally 3 cents or more.
Tax advocates argue that no one will notice a tax of
a penny or two on
soda, a claim vigorously disputed by bottlers
and their customers.
“Soft drink bottlers
and distributors work closely with their customers against
these tax proposals. The recent
defeats of the soft drink tax bills in New
Mexico and Oklahoma were due in part to the joint efforts
of soft drink companies
and their allies, such as state movie theatre
associations and their members. They teamed up to meet
call or testify before legislators to voice
their opposition to these unfair levies. This coordinated
a critical difference.
“The National Soft
Drink Association and its members appreciate the timely
and effective assistance the movie theatre industry
has provided in fighting soft drink taxes.
We will continue to work together in combating these
Exhibitors are welcome
to contact Steele directly at (202) 463-6785. We thank
and his members
as we continue our work together, and
we continue to encourage exhibitors to be
helpful (as they
always are) when called
upon to contact their legislators!