The Impact

How would a beverage tax impact Rhode Island?

In the past, the legislature has introduced legislation that would increase beverage taxes and hurt working families, small businesses and employees the most. There is a chance that the same or similar legislation will be introduced again in 2023. This is the impact that legislation would have on Rhode Island.

  • This is not just a tax on soda. Hard-working Rhode Islanders will struggle to afford common grocery items such as sugar-sweetened beverages including flavored coffee drinks, sports drinks, teas, sodas, energy drinks, lemonades, kombuchas, flavored waters, certain fruit drinks – even frozen lemonade and coffee syrup.
  • Costs are rising for working families in Rhode Island. Inflation, supply chain issues, and the price of gas are making everyday items more expensive. A beverage tax will increase the cost of common grocery items for working families who cannot afford it.
  • Local businesses have worked hard to recover from the challenges of the pandemic. A large tax on beverages is another burden placed on businesses and would lead to job losses and higher prices.
  • This tax could impact more than 4,200 workers and lead to a loss of at least $100 million in annual retail and restaurant sales.

If passed, many residents will drive across the state border to shop Massachusetts and Connecticut; this will only hurt Rhode Island businesses and deprive the state of revenue.

After receiving historic levels of federal funding, a recent state budget office report shows that the state has an $878 million surplus. If the state already has a surplus of money coming in, why raise prices for Rhode Islanders? Now is the time to support small businesses and working families, not enact a tax that will target them as they are already struggling to recover.

BOTTOM LINE: Rhode Island working families, small businesses and employees cannot afford a costly new tax.