Chicago-area tax on sugary drinks on way out after vote

[October 11, 2017]  By Karen Pierog

CHICAGO (Reuters) - A Chicago-area tax on soft drinks and other sugary beverages that angered some consumers and merchants was headed for repeal after a pivotal government vote on Tuesday to end it.

The Cook County Board of Commissioners' Finance Committee, which is composed of the entire county board, voted 15-1 against the penny-per-ounce tax, setting up an expected termination when the board casts a perfunctory final vote on Wednesday.

Cook County, which includes Chicago, narrowly approved the tax in November 2016, making the county the most populous area in the United States to collect a special tax on soda, sports drinks and energy drinks. Retailers earlier this year unsuccessfully sued the county with a lawsuit that claimed the tax was unconstitutionally vague, difficult to implement, and unlawful because similar beverages were taxed differently.

The tax, which took effect in early August, touched off expensive media campaigns. Former New York City Mayor Michael Bloomberg bankrolled ads promoting the tax as a deterrent to childhood obesity, while the soft drink industry through the Can the Tax Coalition ran ads against what it deemed an intrusion into consumers' lives.

Cook County Board President Toni Preckwinkle championed the tax as a health issue and a vehicle for shoring up the county's sagging budget. The $5.36 billion fiscal 2018 budget she proposed last week counts on $200 million from the tax to avoid cuts to healthcare and other core county services.

A groundswell of opposition to the tax led most of the county commissioners who originally voted for it to change their position.

County Finance Committee Chairman John Daley, who had supported the tax, said it was his responsibility to listen to the overwhelming opposition by his constituents to the tax.

"In the upcoming weeks, this budget is going to be challenging," he added.

The finance committee's vote followed hours of testimony from Cook County officials, retailers, healthcare advocates and residents.

(Reporting by Karen Pierog; Editing by Matthew Lewis)

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