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An Ogden Republican is proposing a $100 million tax on soft drinks to help fund Utah's public schools — a proposal that upsets retailers.
HB426, sponsored by Rep. Dixon Pitcher, R-Ogden, would assess a 1 percent tax on soft drinks — or a little under a nickel for a 12-pack of soda.
The revenues generated by the tax would be deposited into the state's education fund, which goes to public and higher education, where Pitcher said preliminary estimates are that it could generate as much as $100 million for public schools.
"We hate it," said David Davis, president of the Utah Food Industry Association. "It's a targeted tax on a narrow base … In this environment, to propose a tax increase of this nature doesn't make a whole lot of sense."
Davis said there is no relationship between soft drinks and education, so it doesn't make sense to tax one to fund the other. And it creates an additional headache for retailers who would have to collect the new tax.
"It's a bill that puts that money directly to the use of the education process," Pitcher said. "Am I going to get beat up? Yeah. It's possible I'm going to take my lumps, but that is a worthwhile goal."
Pitcher said he developed the idea during summer meetings with voters. He said people were eager to help fund public schools and the soft drink tax was one they seemed to be willing to support.
"We all say we probably shouldn't be drinking all the stuff, but we do," he said. "This is an unusual approach to some auxiliary funding that would serve to help reinforce some areas of education that have been hit hard."
As it's written, Pitcher's bill would apply to soda, energy drinks and drinks with less than 50 percent fruit juices, but not things like coffee, milk or water, and it would not increase the tax on beer or alcohol.
About two-thirds of states have some sort of soft drink tax — Utah does not. Colorado passed a 2.9 percent tax on soda last year. New York's governor proposed a large soda tax that was defeated.
The language of Pitcher's bill was made available late last week and it appears unlikely that it will get a legislative hearing this session, since committees are scheduled to meet for the last time this week.
Studies of the states that levy a soda tax have found that the tax has a negligible, if any, impact on obesity rates.
Davis said that taxing soft drinks "demonizes to a certain extent [things] that are legal" and that don't contribute to childhood obesity as much as some other choices.
"When does individual responsibility come back into play?" he said. "We think it's a really bad idea."