Philly Soda Tax Continues To 'Disappoint'

Tyler Durden's picture

Via Political Calculations blog,

The City of Philadelphia's tax collections from its controversial tax on sweetened beverages are continuing to fall well short of the levels that the city's politicians desired. For taxes assessed on sales from January 2017 through preliminary data for October 2017, total beverage tax collections in the city are running over 14% below the amount that city officials were counting upon to support their desired level of spending for a new "free" pre-K school programs, to cover a portion of the debt that the city will take on to make physical improvements to parks, libraries and recreation centers, and also to fund benefits for city employees.

In the chart above, we've projected the amount of tax collections that Philadelphia would need to collect in each month of the year to reach its annual target of $92.4 million if sales of the sweetened beverages distributed in the city followed the seasonal pattern for soft drink distribution in the United States, which we've shown in blue. Meanwhile, we've shown the actual tax collections that Philadelphia's revenue department has taken in from the tax assessed in the indicated months in red. As you can see, the city's actual sweetened beverage tax collections have continually fallen anywhere from 4% to 21% short of the monthly revenue targets needed to meet their annual revenue target.

The closest that Philadelphia has come to hitting its desired level of monthly revenue was for the soda taxes assessed in September 2017 and collected in October 2017, which at $7,567,159, nearly came within $348,000 of the amount that might reasonably have been expected for the month if the city's tax collections were coming in as city officials desired. Unfortunately, that month appears to be an anomaly, according to Philadelphia's Deputy Revenue Commissioner Marisa Waxman:

"This is a new tax with a lot of seasonality and patterns that we’re still learning, so we've never had collections in October before," she said. "There were some circumstances that contributed to this that we think might not repeat. There are other things in there that could repeat. We’ll just have to continue to monitor how this comes in month to month."

Waxman's comments can also be taken as a confirmation that Philadelphia's soda tax collections are not coming in anywhere near as reliably as city officials expected.

Overall, we also find that through October 2017, the total sales of beverages that are subjected to the Philadelphia Beverage Tax are collectively running about 37% below the levels that city officials indicated were occurring before the implementation of the tax.

We should point out that these figures apply to the quantity of beverages that have been subjected to Philadelphia's soda tax, which is not the same as the quantity of beverages that Philadelphians are consuming, where many residents are purchasing drinks outside of the city's limits to avoid the tax, increasing their consumption of alcoholic beverages that are now closer in cost to the taxed soft drinks, or are creatively hacking their way around having to pay it while also getting their sugar fix.

Previously on Political Calculations

Presented in chronological order....


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The Alarmist's picture

There's a shocker! Soda tax fizzles.

Solosides's picture

Because who wants high fructose crack sugar anyway?

Joe Davola's picture

I thought the idea was to improve the health of those who drink soda by discouraging them from doing so.  Just like the taxes on cigarettes.

slwsnowman40's picture

That's what they sell it as.  I'm willing to bet that outside Philly, soda sales have spiked and at a new normal.

E.F. Mutton's picture

This is the same city where Plexiglass is Racist

So I'm guessing not many Mensa Members on the City Council

NoDebt's picture

"and also to fund benefits for city employees."

Where most of the money is actually going.  This was always a boondoggle from day one, sold as more free shit "for the kids".


HisNameIsRP's picture

In other news Philadelphians are still fat :(

RAT005's picture

Only 14% below projection for such a high descretionary tax!?!?, Shame on the people of Philidelphia for not missing by a much more impressive number.

Miffed Microbiologist's picture

This will just embolden the idiots who will go for a national ban. Prohibition 2 here we come.


RafterManFMJ's picture

I live in Philly and am growing sugar cane in my basement. Fuck you, shitty hall!

No Time for Fishing's picture

There will be no more Prohibition of anything, politicians have learned it's way more profitable for them to tax vices not prohibit them. Problem is sometimes the tax reduces the consumption of the vice and they don't make as much money as the like. 

JoeSoMD's picture

But... they are still getting money in... maybe not as much as they expected but it appears to be an upside.  Data showing total grocery and soft drink related tax intake year on year would show whether the new tax is a net gain.  I suspect that it is a net gain.  I used to live in that area and am really, really glad to have gotten out of there.  Miss the cheese steaks though.

No Time for Fishing's picture

There will be no more Prohibition of anything, politicians have learned it's way more profitable for them to tax vices not prohibit them. Problem is sometimes the tax reduces the consumption of the vice and they don't make as much money as the like. 

Ex-Oligarch's picture

On the subject of sales spikes, what's up with that spike in actual sales for September in the last chart?

pods's picture

They should have looked to NY and how they fucked up their cig tax. Cocksuckers. Glad I moved out of that shithole.

Now of course those running Philly will look for other ways to ensure they rape enough money from those unfortunate enough to still live there.  Probably a bottled water tax coming up. They will couch it in terms of lowering the amount of plastic going into the landfills.

Gotta give away more and more shit to keep the "voters" happy.  One would have to be stupid to willingly send your kid to some free pre-K program.  Basically this is a free babysitting gig so single mom's can sell soda at the quickie mart and not have to worry about babysitters.

Thieves is all they are.  Just cause they have the badge don't make it right!  


MoreFreedom's picture

If they tax cigarettes to improve our health, then why does the government subsidize tobacco farmers? 

The federal government spent $1.6 billion subsidizing tobacco farmers from 1995-2016:

The real reason, is to get our money so they can spend it on people, who send them campaign cash for the favor.  That's just an excuse they use to take pop drinkers or tobacco users' money.

rccalhoun's picture

with 'smart' technology, everything can be taxed.

think of all the possible revenue sources for the government



hannah's picture

looks like th city won actually....they are getting a shit load of new taxes on 70% of the soda. saying the numbers are 'off' 37% means they are still getting a massive amount of new taxes...they won.

Number 9's picture

moar money biatches

bamawatson's picture

i'll drink to that

Utopia Planitia's picture

What are they talking about? I'm not the least bit disappointed that tax collection has tanked!  I'm ecstatic!  :-)

Sam Spayed's picture

"to support their desired level of spending for a new "free" pre-K school programs, to cover a portion of the debt that the city will take on to make physical improvements to parks, libraries and recreation centers, and also to fund benefits for city employees."

They put it at the end, but at least they mentioned the actual purpose of the tax and all new taxes, benefits for city employees (or, more accurately, outrageous government pensions).

Argos's picture

Looks like taxes change people's behavior.  Who would have guessed that?

pods's picture

What a Laffer.

Or, maybe, this is some serious shit, this is no Laffing matter?


Fail2Deliver's picture

pffff....Not getting enough in taxes? Just raiise the tax moar. The Libtard solution to everything. Works every time until it doesnt

NumNutt's picture

Yep, worked awesome in Detroit..... I Cannot believe there are actually people still living in that city...

Mike Masr's picture

Chicago is going the same route as Detroit. Liberal scum running the sanctuary city so Chicago is virtually bankrupt. Super high taxes and lots of crime. Go to Home Depot, Jewel or McDonalds. You will be hard pressed to speak with anyone in English. Que? is what you will hear. The homeless population has increased tenfold. It's become one dirty, smelly fucking cesspool. Chicago is now a shithole.  

Mike Masr's picture

The working people of Detroit now live in the suburbs like Royal Oak, Farmington Hills, Novi etc. 

Bill of Rights's picture

Ad this to the top 5 stupidest taxes in the universe...Don't drink soda never have never will.

Iconoclast421's picture

Dindus are smart enough to shop outside the city... which means the city grocers are losing a lot more than just soda revenue...

Froman's picture

The sole purpose of this tax is to fund the underfunded municiple ponzi scheme, er, I mean pension plan.  All of the other nonsense is just lip service by the politicians to make the sheeple think that the money collected through the tax is going for something worthwhile other than paying a former municiple employee $100k in defined pensions benefits each year.

Bill of Rights's picture

Yup just like Excise tax for roads, that the biggest joke and lie Ive ever seen. But now Cities and Towns rely on this revenue so it stays to fund the DREAMERS.

Mike Masr's picture

Fuck the dreamers. Send them back to Mexico and let them fucking dream there!

any_mouse's picture

Wet Dreamers don't get what they dream about.

cbxer55's picture

Because, if you're havin wet dreams, you don't need it. Just need to clean the sheets a damn lot!  ;-)

rsnoble's picture

I dont doubt it for a minute.  Public employees fucking make me sick.   There so fucking priveleged when you go to one of their offices its as if youre the one that needs to kiss their ass. Totally out of control.

Virgil_Cain_76's picture

They're telling us it's for the children (some pre K liberal indoctrination program). I wish that were a joke by me but, that’s actually what they’re telling us. Teacher unions (not that they don’t get enough already) and God only knows what else.  


rsnoble's picture

Only a 37% decrease?  So 63% lazy fat fucks wont stop drinking it or get it elsewhere.  Hell, my as well 3x the tax on everything.

itstippy's picture

Actually, I give them credit for having come somewhat close in their calculations.  Obviously projected outcomes of proposed actions are always VERY rosey, in order to get the legislation passed.  The "soda tax" is no exception, but the roseyness was quite mild compared to other wild-assed "projections" I can think of.  For example:

The Iraq War was to cost $70B tops, and easily pay for itself through lucrative post-war rebuilding contracts.

Obamacare was going to reduce the average families' health insurance premiums by $1,800 anually, even if they didn't go through the program's health care exchanges, and wouldn't raise the deficit one dime.


wmbz's picture

Philly, the city of brotherly hate. The soda junkies that can just drive across the bridge or out of city limts to buy their fix.

Philly, just another city run by libtards, that want everyone else to pay fo day shit.

Linda Hand's picture

Philadelphia is a vision of the glorious globalist utopia to come

Virgil_Cain_76's picture

In Philly they're about to vote on a measure that will prohibit small store owners from having bullet proof glass in their shops. The city council is hiding behind some state law but isn’t really explaining it. Either way, how can anyone force you not to protect yourself in good conscience? The answer: Liberals have no conscience. 

Me thinks the city is getting back at these small stores for the failure of their soda tax scheme...”cause it just can’t be the city’s fault…no no no, it’s gotta be these small business owners.”  Most of the shops w/ the bullet proof glass are owned by Asians. Get this for crazy…there’s this carpet bagger Asian lady on the council from Seattle. She flipped out last year, in public, about a food truck named Wheely Good meals serving asain food. Beating on the side of the truck asking,” Do you think this is a joke, who’s the owner?” She thought it was some racist play on words…the Asian owner and his wife were like “bitch, wtf is wrong with you.”

 I grew up there but live in S. Jersey now, looking to escape that mess as well. Recently came back a few years ago after being overseas for a few and living down south for a few. I’m working on fixing the mistake of coming back.

Don’t forget this is the city that had black panthers standing outside polling stations with billy clubs during soreto’s 2008 election. Oh and voted 100% for soreto’s 2nd term in the Philly voting district. The suburbs aren’t any better. My advice to all of you is if you meet someone moving from this area quiz the crap out of them cause they’ll do to your area what they did to this one. Like obama, most of them just aren’t who we are as Americans


Mike Masr's picture

These fucking morons will be taxing toilet paper "by the sheet" next. WTF!!! 

any_mouse's picture

Obviously, make a State/Federal law one can only make purchases in your local tax authority's area.

Proof of residence and a photo id to buy pop, but not for voting.

Red Raspberry's picture

Chicago rescinded their $200M pop tax and then passed a $230M school property tax increase for da children.

aelfheld's picture

The beatings will continue until morale improves.

ludwigvmises's picture

I find it weird we get articles here complaining about obesity, and next thing we get complaints about a soda tax. That's the best thing they could do. I am shocked we are not doing it on a national level.

hanekhw's picture

Well if you intend to kill mom and pop retail and convenience stores in Philly that tax is an excellent method.

TGDavis's picture

Just because a few uneducated,  low IQ,  limited experience dopes on the Philly city council miss projectons is no reason to gloat.  They're still wasting 7 million a month.