San Francisco would be the first major city in the nation to tax the purchase of soda and other sugary drinks if voters approve Proposition E on Nov. 4.
The tax, a 2-cents-per-ounce add-on, would generate tens of millions of dollars a year for health services and recreational programs.
Berkeley voters are also weighing in on a similar measure.
Supporters say the tax is necessary, as with extra charges for tobacco products and alcohol, to lower the health impacts associated with overconsumption of sugar like obesity and diabetes and to create a revenue stream for education and health services.
The American Beverage Association, which represents large soda companies such as Coke and Pepsi, had by Sept. 30 raised $7.7 million to oppose the measure. The group's campaign has seized upon San Francisco's rising cost of living and growing income inequality.
“At a time when many San Franciscans confront a growing affordability gap — the last thing we need is a new beverage tax,” campaign materials say, noting that it would add “$0.40 to the cost of a bottle of soda and nearly $3.00 to the cost of a 12-pack.”
The tax is assessed to the distributors but is expected to be passed on to the consumer.
Supporters of the measure include a majority of the Board of Supervisors, which voted to place it on the ballot, and health groups like the American Heart Association and the California Dental Association, and $236,020 has been raised so far to pass Prop. E.
In response to the millions being spent to defeat the measure, Supervisor Scott Wiener said in a statement last week that “the soda industry is doing what it always does: unleash a tidal wave of corporate money to try to Bigfoot local communities that are trying to improve their residents' public health. The facts and the science are clear: these drinks are fueling the explosion of type 2 diabetes and other health problems, and a soda tax will make people healthier.”
San Francisco consumes about 3 billion ounces of soda and other sugary beverages annually. A 2-cents-per-ounce tax could generate up to $54 million in revenue and decrease consumption by as much as 31 percent, according to a City Controller's Office report.
The tax revenue would be divided up thusly: 40 percent to San Francisco Unified School District for student nutrition services, 25 percent to the Department of Public Health and San Francisco Public Utilities Commission for health programs and public drinking-water stations, 25 percent to the Recreation and Park Department for recreation programs, and 10 percent for community grants for health-related initiatives.
Since the revenues are earmarked, Prop. E would need two-thirds of votes to pass.
Last year, Mexico adopted a tax of 1 peso per liter on sugary drinks that took effect this year.
But in the U.S., efforts to curb soda consumption have failed.
Michael Bloomberg, the former mayor of New York, planned to ban the sale of large sodas, but the effort was struck down by a judge last year. In 2012, a soda tax in Richmond was defeated by more than 60 percent of voters. And last year, voters in Telluride, Colo., opposed a similar measure.