Thirst for cash brings proposals to tax drinks

May 23, 2010 at 12:00a.m.

Associated Press

WASHINGTON

Thirsty for new sources of cash, health-conscious lawmakers in cities and states across the country are reaching for the refrigerator, proposing taxes on sports drinks, teas and soda.

Politicians say the taxes will help curb rates of obesity and diabetes and can pay for health programs. But retailers and the beverage industry say the taxes are unpopular, unfair and simply won’t work. Last year, federal lawmakers dropped a proposal to use a penny per ounce drink tax — an extra $1.44 for a 12-pack of soda — to help pay for health-care reform legislation. In the year since, however, lawmakers in more than a dozen states and a handful of cities have become the new cola crusaders, proposing similar taxes either to plug budget gaps or fund new programs.

This week, the issue may be back in Washington. The city’s governing body, the District of Columbia Council, is mulling extending the city’s 6 percent sales tax to sodas and other sugary drinks, which are currently exempt, as part of budget negotiations.