SANTA FE, N.M. (AP) — Residents of Santa Fe, N.M., are considering a new tax on sugary sodas and other sweetened beverages to boost access to pre-kindergarten. The tax is being condemned by the soft drink industry as a burden on working families, while supporters say it will pay off in reduced health care costs linked to sugar consumption and improved education.
Here is a look ahead of Tuesday's balloting at how the tax may affect consumers:
TAXES AND EXEMPTIONS
The 2 cents-per-ounce tax would apply not only to traditional sugary sodas but also sweetened sport drinks such as Gatorade, many caffeinated energy drinks, sweetened teas, lemonade and some coffee drinks that contain sweetened syrups.
Artificially sweetened drinks are not taxed. Other exemptions include infant formula, pure fruit juices, weight-reduction drinks such as Ensure, chocolate milk or other beverages where the primary ingredient is milk.
The tax would be levied against beverage distributors, leaving leeway for how costs are passed on to grocers, convenience stores, restaurants — and eventually beverage consumers.
The soda industry is warning that prices will climb by $1.36 for a two-liter soda, $2.88 for a 12-pack of canned soda. The most dramatic increase of all: a canister of powdered lemonade mix jumps from about $7 to $29, based on how much lemonade is made when mixed with water.
Restaurant owners who oppose that tax say they would likely be forced to do away with cheap drinks and free refills for customers and staff, or possibly spread the tax increase across all menu items.
Santa Fe Mayor Javier Gonzales, a key proponent of the tax, says that the proposal includes an incentive for the beverage industry to come up with healthier products by exempting lightly sweetened beverages. That exemption applies to drinks with 10 grams of sugar or less per eight fluid ounces.