Beverage Tax Sweetens Philly Coffers, Sours Retailers USA Today, 2/23/207

“[Alex] Baloga said retailers immediately experienced a ‘massive’ impact. Beverage sales are down sharply as many city residents cross into suburban counties to buy soda, he said. That has lead to changed shopping habits — some customers end up doing all their shopping outside the city, he said. Distributors and supermarkets in Philadelphia have already started announcing layoffs, he added.

‘The important point is that this is having a dramatic, negative impact on retailers, businesses and customers in the city,’ he said. ‘The pain it is inflicting is very real on average, real people.’

Danny Grace, secretary-treasurer of Teamsters Local 830, said about 1,700 of his members are drivers, salesmen and account reps for the soda industry. He said the companies are reporting sales declines of 30% to 40%.

‘Many of our members are seeing a reduction of 50% or more in their take-home pay,” he said. “And I don’t see the business coming back.’

Jeff Brown, CEO of Brown’s Super Stores, which manages several ShopRite stores in the city, told Philly.com this week that beverage sales are down 50% and overall sales are down 15%. He said he expects to shed 300 jobs in coming months.

‘People didn’t change what they drink,’ Brown told the news site. ‘They changed where they’re buying it.’”

Mayor Kenney’s Grocery Tax increased the price of beverages in Philadelphia so people are buying less beverages in Philadelphia. People really do respond to incentives. It’s that simple.