Drinks industry body and local companies file lawsuit in bid to halt Philadelphia sugar tax on soft drinks

Francesca Washtell
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Sugar sweetened soft drinks have come in the firing line in Philadelphia (Source: Getty)

A US drinks industry body and small businesses have launched a lawsuit to try to block a soft drinks tax in the US city of Philadelphia.

The city council voted in favour of the tax in June, which will introduce a levy of 1.5 cents per ounce to sugar-sweetened soft beverages in January.

Proceeds from the tax, if instituted, will go towards pre-kindergarten programmes, improving parks and recreation centres and other projects.

However, the American Beverage Association (ABA) and a number of local businesses began a legal challenge against it earlier this week, on the grounds that it unfairly singles out soda and duplicates a state sales tax already in place.

Read more: Sugar tax will cost UK economy £132m and put 4,000 jobs at risk

The Californian city of Berkeley successfully passed a soda tax in 2014 and went into effect last year. A study released in August showed that in some neighbourhoods consumption of added-sugar drinks was down by around a fifth.

In the UK there has been a strong backlash from the drinks industry against George Osborne’s similar sugar tax, which was a surprise addition to the March Budget, though no legal action against it has been initiated.

The soft drinks levy is due to come into effect in 2018 and will introduce two bands of tax, assessed on the volume of sugar in the drinks companies produce or import.

Read more: Evidence from Mexico shows sugar tax won't be a cure for calorie intake

Last month, the Treasury launched its sugar tax consultation, which will question the definitions of added sugars and the approach to fruit juices in drinks, the treatment of dilutable cordials and syrups, as well as how to approach mixed products such as slushy drinks, among other topics.

The Irish government is also reportedly gearing up to introduce a similar tax, though it is unclear when it exactly it will be implemented.