Costco Sign for Gatorade Shows Wild Impact of Seattle's New Tax

Ouch
By Kate Seamons,  Newser Staff
Posted Jan 13, 2018 6:44 AM CST
In this Oct. 6, 2010, file photo, bottles of Gatorade are on display at a grocery store.   (AP Photo/Paul Sakuma, File)

(Newser) – "That new soda tax in Seattle is working out about as well as Chicago's," proclaims a headline at Hot Air. It's not a compliment. The tax, which went into effect Jan. 1, slaps an additional 1.75 cents on each fluid ounce of sugar-sweetened drinks, a group that includes soda, sports drinks, and kombucha. That's nearly double the one-cent levy the Chicago-encompassing Cook County tried, a tax it repealed after about two months. The Chicago Tribune reported at the time that Costco's nine affected locations saw their sales of beverages impacted by the tax fall 34%, while sales jumped 38% at locations just beyond the county line. And Costco is again at the fore of what's happening: Because bulk purchases contain significantly more ounces than an individual one, the impact is starker, as KIRO discovered when it spotted an updated Costco sign for Gatorade in Seattle.

The sign details Costco's price for the 35-pack of 16-ounce bottles—$15.99—and separately lists the city's $10.34 tax, for a new total of $26.33. But that's not all the sign says: It also directs consumers to nearby locations that are outside city limits and exempt from the tax. The tax is meant to fight obesity and raise funds for worthy expenditures, but the blog for Citizens Against Government Waste sees the ends quite differently: "Let’s be clear. Soda taxes don’t make people healthier. They don't raise revenue—they drive it outside city limits. They don’t help ease inequality—they make the poor poorer." But some in government seemingly remain hopeful: KXLY reports a bill was reintroduced Monday that would push the tax statewide. (Speaking of Seattle and beverages, the world's largest Starbucks is no longer located there.)

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