Guest Column: Tax on soda will hurt more than help
By CAROLE DAWSON
Bremerton Patriot Guest Columnist,
March 5, 2010 · Updated 3:15 PM
My grandfather started the Bremerton Bottling Company back in 1943. Today, we’re a third-generation Pepsi franchise employing more than 65 hard-working employees, some of whom have been with the company for more than 30 years. But if Gov. Chris Gregoire’s proposed excise tax on carbonated beverages and bottled water becomes law, we may be forced to eliminate some of those good-paying jobs.
Like many bottling companies across Washington, we already operate on a razor-thin margin in a highly competitive marketplace – severely restraining our ability to absorb the proposed excise tax. Raising our prices to cover these punitive taxes will only further depress our sales, and the effect will be felt throughout the entire local supply chain — grocers, deliverers, convenience stores. Many people in and around Bremerton might soon have some tough choices to make.
Our products are very price sensitive. In general, for every 1 percent the price goes up, we lose 1 percent in sales. The governor’s proposal would increase the retail price of many of our soft drinks by 25 to 30 percent and a case of water by more than 100 percent.
The Bremerton Bottling Company is not alone. It’s the same situation for the other bottlers who collectively employ nearly 3,000 workers statewide in good-paying jobs with generous benefits, and indirectly support another 17,000.
On Monday, House Democrats released their revenue proposal, asking that the sales tax exemption on bottled water be eliminated. Unlike the governor’s plan, I think this is a fairly good compromise, and represents an effective way to raise funds to reduce our budget shortfall. That said, much work still needs to be done as our elected officials continue to deliberate these proposals in the coming weeks.
We’ve been serving the Kitsap Peninsula for more than 50 years, and I am proud of all the support this community has provided us. We know these are difficult times. We just hope our legislators consider ways to raise funds that don’t unfairly target individual industries, but rather preserve jobs and promote growth in the private sector.