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Better Way for Santa Fe & Pre-K

Frequently Asked Questions

What is the Beverage Tax?

Santa Fe City Council is considering whether to approve a referendum on placing a tax on sugar-sweetened beverages like soda, juice drinks, sports drinks and iced teas. This tax on the distribution of sugar-sweetened beverages will be passed on to Santa Fe restaurant owners, grocers and corner stores, who will then be forced to raise prices on hundreds of beverages.

How much is this beverage tax going to cost me?

Mayor Gonzales has proposed a 2¢ per ounce grocery tax. That adds up. A 12-pack of 12-ounce soda cans could cost an extra $2.88, a 2-liter (68-oz.) bottle of soda could set you back an extra $1.36 and a 10-pack of 6-oz. juice boxes could add $1.20 to the price.

If it passes, hardworking Santa Fe families will be left paying this hefty tax.

I’ve heard this tax referred to as “regressive.” What do people mean by that?

You will often hear taxes like the Beverage Tax referred to as "regressive." That’s because taxes like this one disproportionately affect low-income and working class families who spend a larger percentage of their income on food than wealthier families.

Democratic presidential candidate Sen. Bernie Sanders came out against the tax in Philadelphia for this very reason. In an interview on NBC’s Meet The Press, Sanders claimed the soda tax is "a totally regressive tax" and money shouldn’t be raised on "the backs of low-income or hard-working people."

Senator Sanders and many of Santa Fe’s local businesses believe a tax like this at the grocery store would hurt low and middle-income families.

Which beverages would be affected by this tax?

The proposal applies to any beverage with added sugar – that could translate to more than a thousand beverages like sodas, juice drinks, energy drinks, some teas and sports drinks— even kombucha!

Who’s going to pay for the tax?

You will. All taxes are paid by the consumer. Whether the tax is slapped on wholesalers or retailers, the amount of that tax is added to the price. This is what happened in Philadelphia, where people were shocked to find their beverages had doubled in price in some cases overnight.

Where is the money going?

Mayor Gonzales has said pre-K is the reason for a new tax. However, when Philadelphia passed a beverage tax for the same thing voters learned later that a good portion of the money was earmarked for government salaries, pensions, and bringing down interest payments on debt. Even if all the tax money goes to Pre-K, the beverage tax will prove an unreliable source of revenue for a permanent program like Pre-K. It is well known that sales of regular soda have been declining, and people will buy cheaper beverages outside the city if the prices go up due to a tax. That means beverage sales in Santa Fe will go down, and so too will the revenue for the tax. Mayor Gonzales will have to come back for more money to keep Pre-K fully funded.

How will this tax affect Santa Fe residents and businesses?

This tax is regressive and disproportionately impacts the grocery bills of those who can least afford it. It’s unfair that the wealthy pay a much smaller share of their income under a beverage tax.  Neighborhood grocery stores, restaurants, movie theaters and other local businesses that rely on beverage sales for a good part of their income will be hit especially hard. They will lose sales when people shop in stores outside the city to avoid the tax or go to theaters and restaurants surrounding Santa Fe. Losing business like that means a loss of income for employees whose hours are trimmed or worse, jobs are cut.

What can I do to stop this tax?

Vote! Early voting is underway and election day is May 2nd. You can learn more about important dates and information here.

You can stay up-to-date on the latest tax developments by joining our growing citizens’ coalition.