A Philadelphia ShopRite Convenience Store Shall Close

Two years after it first went into effect, the negative fallout from Philadelphia’s controversial soda tax continues to pile up. Here is a short overview of the news headlines that has broken since we last examined what has perhaps become the most unpopular taxes in the town of Brotherly Love. A Philadelphia ShopRite convenience store will close, with the dog owner citing lost business related to the city’s soda tax as the primary reason for its closure. The store is located near Philadelphia’s city limits, where local residents may actually took a good portion of their business over the border to avoid paying the tax.

A second unbiased study has confirmed that net soda usage among Philadelphia’s total populace has not meaningfully dropped, where “the taxes did not improve nutritional intake by encouraging consumers to substitute to healthier beverages”. A 116-count federal government indictment against International Brotherhood of Electrical Workers leader John J. Dougherty (aka “Johnny Doc”) and Philadelphia city councilman Robert “Bobby” Henon, among others. Inside a populous city like Philadelphia where political corruption scandals are normal, that news itself might not stand out, except in this case, because it says quite a bit about the true motivation behind Philadelphia’s soda pop tax.

According to a federal government indictment unsealed Wednesday, corrupt Democratic city officials and electricians’ union market leaders pushed through the soda tax in 2016 in a revenge feud against the Teamsters union, rather than a inspiration to have an effect on open public health. The Teamsters opposed the soda tax because they believed it could cost them jobs by reducing demand for carbonated drinks.

When aides to Democratic Mayor Jim Kenney tried to describe to Mr. Dougherty the public health advantages of the soda tax, the indictment alleges, the union leader replied, “You don’t have to describe to me. Dougherty’s support for the controversial tax was essential because of the IBEW Local 98’s money and political influence within the town, where the union’s backing often made the difference between candidates winning elections or not.

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In addition, Johnny Doc’s influence reaches appointed positions, including gifts to judges, who might then be counted upon to back the union-supported positions such as on the soda pop tax when its legality was challenged in court. The entire magnitude of the unfurling politics scandal as it pertains to how the Philadelphia’s soda tax was passed and survived legal problem is not yet known. 7,567,159 in September 2017, so if it were to collect that much once again, it could fall about one million dollars short still.

77.8 million would be 84% of this shape. In 2017, Wharton Business School Professor of Finance and Public Policy Robert Inman indicated the Philadelphia Beverage Tax could be considered a success if it gathered 85% to 90% of the city’s original income target. It shall probably miss clearing that low bar needed to be considered successful in 2018. The only question is by how much does it fall short now?

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