Bitcoin Forum
November 17, 2018, 12:14:28 PM *
News: Latest Bitcoin Core release: 0.17.0 [Torrent].
 
   Home   Help Search Login Register More  
Pages: [1]
  Print  
Author Topic: Philadelphia's soda tax is crushing the city’s beverage business  (Read 39 times)
Hydrogen
Hero Member
*****
Offline Offline

Activity: 966
Merit: 687



View Profile
February 24, 2018, 08:58:25 PM
 #1

Quote
If you live in Philadelphia, that bloated feeling you get from consuming carbonated beverages may be coming from the soda price itself.

Last summer, the city passed a Bloomberg-esque 1.5 cent per ounce tax on soda and other sweetened and diet beverages, a move opposed by beverage distributors and retailers.

Since this tax has gone into effect on Jan. 1, consumption of the sweet drinks is off by as much as 50 percent, according to retailers, and companies involved in getting these drinks to consumers are reporting huge losses and announcing layoffs
.

Since it is a volume-based tax, its proportional impact on beverage bills vary wildly, with single-serve cans at supermarkets and restaurants being affected in a small way, while cash-pinched purchasers of cheaper store-brand 2-liter bottles are seeing prices nearly double.

Last week, PepsiCo blamed a 43 percent drop in business on the new tax and announced it would be laying off 80 to 100 area employees (out of 423) over the next few months. Similarly, Canada Dry gave pink slips, effective March 5, to 25 of its workers. Retailers are also feeling the pinch, with Jeff Brown, owner of Brown’s Super Stores, saying he expects to ax 300 employees at his company’s six Philadelphia ShopRite stores this spring.

On the plus side, the city reports that it raised $5.7 million, or more than double its forecast, in January alone, from the tax. Some of this money has been used to fund expanded pre-K, and the city fired back at the PepsiCo layoff announcement in part by pointing to the roughly 250 teachers and support staff jobs created under the program.

Anthony Campisi of the American Beverage Association, one of the major opponents of the beverage tax, says the economic woes brought on by the measure are enough to outweigh any benefits touted by the city. “Distributors like Canada Dry are off
about 50 percent year-on-year,“ he says. “The 20 percent increase in suburban sales we’re seeing (as shoppers cross city lines to save money) is far from enough to make up for that.”

City officials, for their part, are disputing both the consumption reduction and layoff figures and saying opponents of the tax may be trying to deter other big cities from trying to follow suit.

According to Mike Dunn, spokesman for Mayor Jim Kenney, the city had projected a 27 percent consumption decline as a result of the tax.

“We have no way of knowing if their sales figures and predicted job losses are anything more than fearmongering to prevent this from happening in other cities,” he says.

Ken Klein, one of the owners of Klein’s Supermarket — a 3,500-square-foot single-store operation in the city’s Fairmont neighborhood — points out that volume is down across the board, as are his customers, the vast majority of whom own cars, unlike in New York, and “drive out of town to save money on grocery bills.”

“So far,” he says, he’s been able to avoid laying off any of his 20 full-time and part-time help.

The rise in cost has hit hardest proportionally on customers buying cheaper store brands, with prices in many instances up nearly 100 percent.

“Personally, I think that the concept of funding pre-K is a good idea but the method of doing it is a bad idea,” says Klein, who adds that the tax has given sweetened carbonated beverages a “double whammy,” after health concerns have already put pressure on sales.

https://nypost.com/2017/03/05/phillys-soda-tax-is-crushing-the-citys-beverage-business/

This is an article from 2017. It illustrates some of the potentially negative aspects of regulation as well as taxes.

The negative effects the beverage tax has had upon business serve as a microcosm of how venezuela's restrictive regulatory policies led to economic ruin. It is possible future regulation of crypto currencies could have similar negative effects, which could be one motive for the recent decline of bitcoin prices as well as what could be a future bear market.

I know that many posters on this forum might disagree with things I have said here. I wish they would respond to my posts(like this on) more often so we can have some nice talks.  Smiley

Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1542456868
Hero Member
*
Offline Offline

Posts: 1542456868

View Profile Personal Message (Offline)

Ignore
1542456868
Reply with quote  #2

1542456868
Report to moderator
jhenfelipe
Hero Member
*****
Offline Offline

Activity: 980
Merit: 550


View Profile
February 24, 2018, 10:25:41 PM
 #2

There is always a negative and positive effect for every action.

Well, in beverages tax, most affected are the business owners/employees due to lower volume of consumers. On the other hand, those who stop buying the said products benefit from it, aside from they save money, their intake of sugar would be lessen which is good for their health.

In regards with crypto, it could happen too (drop the number of users due to tax), which will surely affect the price. On the positive side, it might save crypto users from scams, fraud, etc. whenever Exchanges and ICOs become regulated.

In conclusion, I think regulation and tax couldn't stop people to buy any products, whether it is physical or digital. Those who want it and are able to will always buy regardless of the extra payment. (unless it becomes illegal)
Mometaskers
Hero Member
*****
Offline Offline

Activity: 952
Merit: 546



View Profile
February 25, 2018, 06:33:37 PM
 #3

This is also happening in my country. Not just a single city but nationwide. Since we run a small retail store, ever since they introduced that sugar tax the price of soda has increased so we also had to charge higher. People still buy though, they have really no option if they want to cool down in this tropical heat.

I guess we still had it easier than the cane farmers in the countryside though. A year even before this tax was discussed, Coca-Cola has announced they'd be reducing the sugar they'd be using in their soda/

In conclusion, I think regulation and tax couldn't stop people to buy any products, whether it is physical or digital. Those who want it and are able to will always buy regardless of the extra payment. (unless it becomes illegal)

Well, Prohibition Era proved that people would buy stuff they want even if it become illegal.
nc50lc
Full Member
***
Offline Offline

Activity: 406
Merit: 148


∙Self-proclaimed-Genius ㊙️


View Profile WWW
February 26, 2018, 06:32:13 AM
 #4

Those said taxes was for the benefits of their own citizens.
Sometimes we have to see the bigger picture to notice the positives than the immediate negatives we see.

Here in my Country, the Govt just proclaimed higher tax rate to sweets and sodas. Consumers and Retailers are complaining as expected.

We, Digital Currency owners will complain if ever a regulation was declared.
Depending on what is regulated, it could take some time for others to accept what's left of their "freedom".
(T/N: If you want real freedom, expect a lawless society)

(っ◕‿◕)っ Newbies and Newbies at heart! Remember to Lock your Thread(s) after receiving enough replies/sufficient answers. 
FEELING GENEROUS?: 39EKeFj43inkH6Ctkosh9E7oskx3tvhSXi ∙ Do not buy non-mainstream ASICs at second-batch and onwards, you know the risk!
Hydrogen
Hero Member
*****
Offline Offline

Activity: 966
Merit: 687



View Profile
February 26, 2018, 10:39:30 PM
 #5

Those said taxes was for the benefits of their own citizens.
Sometimes we have to see the bigger picture to notice the positives than the immediate negatives we see.

Well, here's an interesting factoid for you.

In the united states prior to 1913, when the income tax was passed, american economic growth was often as high as 10% per year. Today the united states is lucky if it can achieve 1% economic growth. If there's a year where the united states economy grows 1% that is a huge bragging point for politicians and the media. There's a question of what happened to america's economic growth which used to be near to 10% every year.

There's an argument which can be made that high taxes have a crippling and restrictive negative effect on economic growth.

When the US income tax was passed in 1913 the rich paid 6% income taxes, everyone else paid a 1% income tax. At these tax rates, people had paved roads, police, firefighters and all of the other pro tax things many claim we wouldn't have without high taxes. From 1913 till today income taxes have rose from 1% to 30%+. If all of the taxes someone paid were added together, the real tax rate is closer to 50% or higher.

So there is a question of whether those high tax rates have a negative effect on economic growth, job markets and other key statistics which have gradually fallen over the past century. Average working days have gotten longer, days off and vacation time has gotten shorter.

People say there are "benefits" and "positives" of paying high taxes but we have yet to see much evidence of that. Rather circumstances appear to be deteriorating more the higher taxes are raised, the more bloated and wasteful state spending becomes as a result.

Pages: [1]
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!