Today Assemblyman Jeffrey Dinowitz (D-Bronx) sent a letter to Governor Paterson urging him to reduce and expand his budget proposal to assess a tax on sugar sweetened beverages.
As proposed, the new tax would take effect on September 1, 2010 and would charge consumers of sodas and beverages consisting of less than 70% real juice $0.01 per ounce.
Assemblyman Dinowitz suggested to the Governor that his tax proposal, which is expected to generate $450 Million, be altered to include all products with sugar, not just beverages. Assemblyman Dinowitz said “if we want to take serious action to combat obesity, we shouldn’t limit ourselves to just beverages. The limited scope of the Governor’s proposal has allowed its intent of encouraging people to live healthier while generating revenue for the state to become muddled. By expanding the number of products that would be covered under the sugar tax we would generate more revenue and provide a greater disincentive to engage in unhealthy behavior.”
The proposal being advanced by Assemblyman Dinowitz would assess a $0.001 tax per gram of sugar for all products. This would include a range of food items including condiments, beverages, candy, baked goods, and breakfast cereals.
Assemblyman Dinowitz added that “we need to be honest with the public. This soda tax is not going to be a silver bullet that both generates the revenue that we need and accomplishes the goal of reducing obesity. My proposal would be a small, broad-based tax that targets all unhealthy food products containing sugar that will generate significantly higher revenue for health programs in New York. We need to do what we can to generate revenue and mitigate the potentially catastrophic spending cuts that are being proposed in the Governor’s budget.”
The text of the letter follows:
“March 18, 2010
Governor David Paterson
New York State Capitol
Albany, New York 12224
Dear Governor Paterson,
As has been widely reported, the 2010-2011 New York State Budget includes a proposal to assess a tax on beverage syrups and soft drinks. The proposed tax rate for these beverage syrups and soft drinks is $7.68/gallon for beverage syrups and $1.28/gallon for soft drinks. This so-called “soda tax” has been met with opposition from many of my constituents and many of my colleagues in the State Legislature.
My colleagues and I are well aware of the current year deficit of over $9 billion and future deficits of close to $40 billion over the next five years. As I see it, the State needs to make significant investments in fighting obesity which is driving up our healthcare costs and we must take steps to identify ways to generate revenue during this difficult fiscal time. I feel that it would be irresponsible to summarily reject your proposal to tax beverage syrups and sodas or to accept it in its current form. I feel that it is regressive in nature and may not generate the estimated $450 million in 2010-2011.
I would like to propose an alternative proposal which I believe achieve your stated goal of generating needed revenue for the state’s Medicaid program and working to curb obesity in the greater population. Rather than taxing only sugar sweetened beverages at the rate of $0.01/ounce, I recommend a broader tax on products containing any sugar at all at a rate of $0.001/gram of sugar. That amounts to a total of $0.01 per 10 grams of sugar.
I have attached a table of common food products including M&M’s, Skittles Candy, Jif Peanut Butter, Coca Cola and Entenmanns Frosted Donuts and what their sugar content is and what the proposed tax would generate per package. I urge you to consider broadening your proposal at a much lower tax rate to discourage more people from eating unhealthy food products and to generate much needed revenue for the state.
I would be happy to discuss this matter with you in more detail in coming week. Thank you very much for your attention.
Member of Assembly
Cc: Hon. Dr. Richard Daines, Commissioner, New York State Department of Health, Hon. Robert Megna, Director, New York State Division of the Budget”