Illinois Senate proposes statewide tax on soda

January 18, 2017
By Brendan Bakala

Running out of ideas, the Illinois Senate takes aim at poor people to fund record-high state spending.

A new bill in the Illinois Senate is taking aim at soda drinkers.

Senate Bill 9, proposed as the Sugar-Sweetened Beverage Tax Act, would place a penny-per-ounce tax on bottled sugar-sweetened beverages, syrups or powders sold or offered for sale to a retailer for sale to a consumer.

State Sen. Toi Hutchinson, D-Chicago Heights, introduced the bill Jan. 11, and if passed, the new tax would supposedly raise an estimated $560 million annually for Illinois, the Southern Illinoisan reported.

But the law would raise this money on the backs of poor Illinoisans.

The tax would extend to any beverage with more than 5 grams of caloric sweetener. If passed, the tax would go into effect May 2017. Revenue from the soda tax would be split, with 98 percent going into the state’s general fund and the other 2 percent going toward the Tax Compliance and Administration Fund for the administrative costs of the Department of Revenue.

While retailers would face heftier costs from the new tax, it would be poor and lower-income Illinoisans who would be hurt the most. A poll from Gallup shows that 45 percent of people making less than $30,000 a year consume regular, sugary soda. And as incomes rise, consumption of regular soda decreases. Only 34 percent of those making $30,000-$74,999 a year consume regular soda, and only 20 percent of people making $75,000 a year or more drink regular soda.

Like sales taxes, a tax on soda is regressive. It would place a larger share of the tax burden on residents least capable of paying it. On top of that, many residents from Hutchinson’s district would be hit the hardest.

In November 2016, the Cook County Board approved a countywide, penny-per-ounce tax on sugary and artificially sweetened beverages in a closely contested 9-8 vote. The Cook County tax will go into effect July 2017. If SB 9 passes, residents in Hutchinson’s hometown of Chicago Heights will have to essentially pay a double tax for their pop by July.

Lawmakers in Springfield should focus on truly fixing the state’s long-term, systemic, fiscal problems, instead of passing a new, regressive tax. Illinoisans already have one of the largest tax burdens in the nation when all taxes are accounted for, and the last thing residents of the Land of Lincoln need ̶ especially in Cook County ̶ is yet another tax.

TAGS: budget, sugar tax, taxes