The Issues

BEVERAGE TAXES DON’T WORK

A new beverage tax would be costly for working families and small businesses. Beverage taxes cost jobs and raise prices, and have not been proven to change people’s shopping habits when it comes to their favorite drinks. Baltimore’s economic inequities will only get worse.

The most recent United Way ALICE (Asset Limited, Income Constrained, Employed) report showed 53% of Baltimore City households can’t afford the high cost of living. Feeding America’s report showed Baltimore’s food insecurity rates increased from 18% to 21.7% since the pandemic.

A 2023 study from the University of California, Davis highlighted four California cities that adopted beverage taxes. Researchers found that the taxes did not decrease beverage purchases, which was the stated intent of the taxes. Instead, the tax forced people to either pay more for their beverages or shop outside the city to avoid the tax.

EXCESSIVE TAXATION ADDS UP

BALTIMORE IS EXPENSIVE AND CAN’T THRIVE IF THE CITY COUNCIL KEEPS NICKLE AND DIMING ITS RESIDENTS.

The Baltimore City Council already imposes a container tax on beverages. Another tax will increase the risk of forcing local businesses to lay off employees or close their doors. Job losses and store closures have happened in other cities after beverage taxes were passed.

Local grocery store Santoni’s closed in 2013 because of the hit it took after the bottled container tax. The store owner was forced to lay off 80 people, lost 3,000 customers a week and more than $4 million in sales three years after the tax went into effect.

Baltimore’s working families and local businesses cannot afford this extra expense.

“There is little evidence that lower-income households have reduced purchases of sugary beverages in response to these taxes, meaning they are bearing the burden of the portion of the tax passed forward to retail without gaining health benefits.”

University of California, Davis

Kristin Kiesel, Co-Director of the Diversity and Inclusion in Research, Education, and Career Training (Direct) Program.

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