California enacts law banning new soda taxes

June 29 (UPI) — California has banned taxes on sodas and other sugary drinks after a threat by manufacturers to use a state ballot measure on local taxes.

The bill was rushed through the California legislature, where it passed in the Senate 21-7, with most Republicans abstaining. The Assembly approved it 50-1, and Gov. Jerry Brown signed the legislation on Thursday.

The law calls for a ban on all taxes on grocery purchases for 12 years, but does not end soda taxes already in place in San Francisco, Berkeley and Oakland.

The legislation does block soda tax proposals in four other cities.

Public health groups have supported a movement to tax drinks in an effort to reduce sugar consumption, particularly in low-income neighborhoods.

Non-alcoholic beverage manufacturers opposed the tax and threatened a well-funded initiative on the November ballot calling for an increase in the voter threshold to approve local sales taxes on any item from a majority to a supermajority, making it more difficult to raise sales taxes.

The business group supporting the initiative, which includes the soda industry, withdrew the ballot measure after the legislatures approved the bill.

Signatures in support of the ballot initiative were obtained in a campaign financed by the beverage industry.

Brown said he reluctantly signed the bill, adding that raising the voter threshold “would be an abomination.”

“This is definitely one of the toughest votes I am going to have to take, another example of how special interests hijack our political system,” said State Sen. Ricardo Lara, a Democrat who voted for the tax ban.

Similar preemption laws have passed in Arizona and Michigan. Business groups in Oregon and Washington also support ballot measures to pre-empt tax increases.