In June 2017, sales of naturally and artificially-sweetened beverages in Philadelphia subject to the city’s plummeted to be more than 40% below their estimated pre-tax quantities.
That wasn’t what Philadelphia’s political leaders were expecting to happen, where the following chart shows how many millions of ounces of sweetened beverages were estimated to have been sold in Philadelphia in each month before the city’s controversial beverage tax took effect in January 2017, how many ounces city officials expected to be sold after the tax went into effect, and finally the actual quantity of sweetened beverages subject to the city’s tax in its first six months of existence.
Even though months of actual data were shouting that Philadelphia Beverage Tax collections were falling short, it wasn’t until 13 June 2017 that city officials finally acknowledged that the depressed sales of sweetened beverages subject to the city’s new beverage tax would result in the city missing its $46 million revenue target for the tax in its first six months of being in effect. The city subsequently moved the goalposts for its first six-months estimate to $39.7 million later in the month.
We can now confirm that Philadelphia appears set to miss that lowered mark by several hundred thousand as well, where data recently provided by the city after the 20 July 2017 payment date for beverage taxes imposed through the end of June 2017 indicates it will have collected just $39.3 million in the first half of 2017. The following chart shows our estimate of the amount of revenue that Philadelphia city officials would have reasonably expected to collect each month from the beverage tax based on the seasonal pattern for soft drink distribution in the U.S. along with the amount the city has reported collecting in the tax’ first six months of being enforced.
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