Philadelphia's controversial high tax on sweetened drinks is making it so difficult for consumers to buy them that the beverage industry says they need to cut jobs to account for low sales, while a local university said that they might need to raise meal plan costs in order to continue serving soda. City officials have questioned the veracity of such statements.
The "soda tax" started in the city on Jan. 1, adding 1.5 cents per ounce to most sweetened drinks, including some soda, iced tea, nut milk and diet soda, while baby formula and products containing at least 50 percent milk or fresh fruit and vegetables are exempt, according to Philly.com.
That comes out to a roughly 50 percent tax in some cases, as shown on a viral social media photo of a Propel Water 12-pack, which shows a $3.04 tax added to the $5.99 product.
At one supermarket, the price of a $1.99 two-liter bottle of coke now costs $3, reports The Associated Press.
"You're kind of in a no-win situation unless you want to buy bottled water," Anthony Campisi, a business representative working to overturn the tax, told AP.
Indeed, many residents have either stopped buy the sweetened drinks or are going out of their way to get them from other cities.
"Mostly I'm drinking spigot water, and not because it's healthier," said Fran Flanagan, who does not support the raised prices.
The city's Temple University stated that they would have to increase costs of their meal plan in order to afford the taxed beverages, although they have since backtracked under pressure and said that they would re-examine the numbers, while some soda companies have said that sales have dropped dramatically since the new year in the City of Brotherly Love.
PepsiCo reported a 40 percent decrease that they said will leave them no choice but to lay off between 80 and 100 workers. Canada Dry's sales are reportedly 45 percent lower, which has led to them laying off nearly 30 employees, while the company that owns ShopRite stores said that workers have fewer hours since purchases have dropped by 25 percent as customers are electing to purchase groceries in other cities.
But not everyone buys those claims. Bloomberg Philanthropies Advisor Howard Wolfson, whose company believes that the tax promotes healthy choices, suggested that either "jobs are being sacrificed to make a political point" or else the companies were struggling before the tax increase.