- Days left

Your soda habit may be getting more expensive.

The Wall Street Journal (subscription required) reports that "The Center for Science in the Public Interest, a Washington-based watchdog group that pressures food companies to make healthier products, plans to propose a federal excise tax on soda, certain fruit drinks, energy drinks, sports drinks and ready-to-drink teas. It would not include most diet beverages. Excise taxes are levied on goods and manufacturers typically pass them on to consumers."

The rationale behind the proposal is that the consumption of sugary beverages leads to weight problems which in turn lead to serious health problems. Taxing soda seems like a perfectly fair way to raise cash to pay for expensive changes in America's health care system. If it leads to a continued decrease in soda consumption, that's even better: Less soda and more water means better health and lower health care expenses.

A special tax on soda is just one of hundreds of proposals being considered to help raise cash to pay for rising health care costs, but it looks like one of the better ones. The only real argument against it (other than the standard "No New Taxes!") is that it would disproportionately target low-income Americans and have a greater impact on their wallets. Soda might be a fairly significant part of a poor person's budget, but soda doesn't earn wealthy people any more money. As Andy Warhol wrote, "A Coke is a Coke and no amount of money can get you a better Coke than the one the bum on the corner is drinking."

The beverage industry is already lobbying heavily against it, of course, so it probably won't get passed. But if you're going to increase taxes, this is the way to do it.


Increase your money and finance knowledge from home

Banking Services 101

Understand your bank's services, and how to get the most from them

View Course »

How to Buy a Car

How to get the best deal and buy a car with confidence.

View Course »

TurboTax Articles

What is IRS Form 8824: Like-Kind Exchange

Ordinarily, when you sell something for more than what you paid to get it, you have a capital gain; when you sell it for less than what you paid, you have a capital loss. Both can affect your taxes. But if you immediately buy a similar property to replace the one you sold, the tax code calls that a "like-kind exchange," and it lets you delay some or all of the tax effects. The Internal Revenue Service (IRS) uses Form 8824 for like-kind exchanges.

What are ABLE Accounts? Tax Benefits Explained

Achieving a Better Life Experience (ABLE) accounts allow the families of disabled young people to set aside money for their care in a way that earns special tax benefits. ABLE accounts work much like the so-called 529 accounts that families can use to save money for education; in fact, an ABLE account is really a special kind of 529.

What is IRS Form 8829: Expenses for Business Use of Your Home

One of the many benefits of working at home is that you can deduct legitimate expenses from your taxes. The downside is that since home office tax deductions are so easily abused, the Internal Revenue Service (IRS) tends to scrutinize them more closely than other parts of your tax return. However, if you are able to substantiate your home office deductions, you shouldn't be afraid to claim them. IRS Form 8829 helps you determine what you can and cannot claim.

What is IRS Form 8859: Carryforward of D.C. First-Time Homebuyer Credit

Form 8859 is a tax form that will never be used by the majority of taxpayers. However, if you live in the District of Columbia (D.C.), it could be the key to saving thousands of dollars on your taxes. While many first-time home purchasers in D.C. are entitled to a federal tax credit, Form 8859 calculates the amount of carry-forward credit you can use in future years, not the amount of your initial tax credit.

What is IRS Form 8379: Injured Spouse Allocation

The Internal Revenue Service (IRS) has the power to seize income tax refunds when a taxpayer owes certain debts, such as unpaid taxes or overdue child support. Sometimes, a married couple's joint tax refund will be seized because of a debt for which only one spouse is responsible. When that happens, the other spouse is said to be "injured" and can file Form 8379 to get at least some of the refund.

Add a Comment

*0 / 3000 Character Maximum