Proposed New York budget includes 18% soda tax

by Keith Nunes
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ALBANY, N.Y. — The 2009-10 state budget proposal by the office of New York Governor David A. Paterson includes an 18% sales tax on non-diet soft drinks. The tax also would be charged against "sugary drinks containing less than 70% real fruit juice." The governor’s office said the revenue from the tax will be used to "combat obesity and related diseases."

For the food industry, such a proposal carries significant implications. While the New York state budget initiative focuses solely on non-diet soft drinks and sugary drinks, it opens the door for other tax initiatives on food products thought to increase the incidence of obesity.

"Singling out one particular product for taxation won’t even make a dent in a problem as complex as obesity," said the American Beverage Association in a statement. "This point is supported by science as well as common sense. If we want to be serious about battling obesity, we need to comprehensively address the consumption of all foods and beverages in moderation and get more active as a society. It’s discouraging that some are perpetuating the myth that taxing one product will make a difference in obesity, or even contribute to fighting the problem. It won’t."

New York budget officials estimate the tax will raise approximately $404 million in fiscal year 2009-10 and $539 million in the following budget year.

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