MONTGOMERY, Ala. — Among the proposals made to fill the General Fund’s $250+ million budget hole during the upcoming Special Session is a brand new tax on soft drinks, including sodas, juice, sports drinks, coffee drinks, and yes, sweet tea. One group of businesses and concerned citizens, calling themselves the Stop the Alabama Beverage Tax Coalition, has joined together to fight back against the proposal.
“A soda tax will costs jobs, hurt our small businesses and raise grocery bills at a time when Alabama families are still recovering from a struggling economy,” said Virginia Banister, Executive Director of the Alabama Beverage Association.
“Stop the Alabama Beverage Tax believes consumers are burdened enough with taxes– there couldn’t be a worse time to risk jobs and force taxpayers to pay higher prices at the grocery store. We intend to deliver this message loud and clear to lawmakers.”
The proposal would levy a tax of 5 cents per 12 ounces of non-alcoholic beverages, excluding bottled water, adding 60 cents to the price of a 12 pack of soda, or 54 cents on a gallon of sweet tea. All this on top of the state’s sales tax on groceries, which two of Alabama’s neighbors—Georgia and Florida—do not have.
Some retailers, particularly in communities close to Alabama’s borders, worry this could cause their shoppers to simply skip the state line to purchase the soda—and the rest of their groceries, while they’re at it.
Kenny Smith, owner of L&S Foodland in Ardmore—a mere mile from the Tennessee line—says a tax on beverages could cost him customers and sales.
“We operate on the state line,” said Smith. “This tax will be detrimental to our business and our customers who will just travel to Tennessee to buy their groceries.”
At least one soda bottler, Atmore’s family-owned Pepsi Bottling Company is affixing the Coalition’s logo on the back of each of its distribution trucks to help raise awareness.
“This tax would be devastating for small businesses like us,” said the company’s vice president Dale Ash, who is also the president of the Alabama Beverage Association.
“We are asking people to sign up and pray,” Ash said. “I mean that sincerely. We are fighting for this company’s life. We’re going at it as if life depended on it… We are committed to this area. We were born and raised here. We create jobs in Atmore. We try to give back. Atmore has been wonderful to our family.”
While several states impose taxes on sugar-sweetened beverages or sodas in particular, Alabama would be one of only a few states that would tax beverages cart-blanche.
Several legislators have spoken out against the imposition of a beverage tax, including Rep. Jack Williams (R-Vestavia Hills) who called it a tax on every Alabama family.
Alabama House Speaker Mike Hubbard has also indicated he doesn’t support the law.
“Rather than just picking out and say we’ll do this because it can generate this amount of money… [a soda tax is] the wrong way to look at tax policy,” said Speaker Hubbard. “I don’t like picking winners and losers I don’t think that’s what we need to be doing.”
Also being considered is a significant increase in the tax on tobacco products, and the levying of another brand new tax on e-cigarettes and vaporizers which contain nicotine, but not tobacco.
The Alabama Legislature will reconvene on August 3rd for the Special Session called by Governor Robert Bentley (R-AL) to make another attempt at constructing a General Fund budget that both houses can pass, and the governor won’t veto.
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— Elizabeth BeShears (@LizEBeesh) January 21, 2015
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