The city Department of Revenue announced last week that the city received $5.7 million in collections for the first month of the beverage tax, more than doubling its predictions for January.
The projection for a full fiscal year of the tax is more than $91 million. The initial months’ collections of the tax are expected to be lower than later months because inventory on hand as of the Jan. 1 effective date was not subject to tax. As a result, many retailers stocked up in advance. Additionally, it is anticipated that some distributors and dealers may be slow to register, file and pay.
Revenue from the tax will be used to make investments in pre-kindergarten and schools as well as in Philadelphia parks, recreation centers and libraries.
The tax is 1.5 cents per ounce on the distribution of sweetened beverages as well as syrups and concentrates used to make sweetened beverages.
The Ax the Bev Tax Coalition issued the following statement in response to the beverage tax collection numbers released by the city.
“Regardless of how much money the administration says it collected in the first month of this tax, the pain Philadelphia families and businesses are feeling is very real. The beverage tax is causing prices on thousands of items to skyrocket, sending shoppers outside the city and forcing steep declines in sales. This in turn hurts the restaurants, supermarkets and corner stores that are the cornerstones of our communities. This steep drop-off in sales is already causing layoffs and a reduction in hours in family-sustaining, union jobs. For the working families paying drastically higher prices and the businesses impacted by the tax, the pain is only going to worsen over time.”
Dennis Fink, owner of Fink’s hoagie shop at 4633 Princeton Ave. in Tacony, said, “This is a tax on the working class. Most of my customers don’t have a lot of money, and I’m hearing from them every day that this tax is sticking it to them where it hurts the most. We try to keep our prices low because we know the families who eat here have to pinch every penny, but this tax is more than our customers can afford.”
Sean McMenamin, president of family-owned ShopRite supermarkets at 11000 Roosevelt Blvd. and 9910 Frankford Ave., said, “This tax has been devastating on stores like ours, which operate in neighborhoods that are very close to the suburbs. “Since the tax was put into effect, our customers have started shopping outside the city. This campaign will help us get the message out about the damage this tax is inflicting on Philadelphia families and businesses.” ••
