Baltimore City Council gave its final approval late last week for a two-cent tax on bottled beverages as part of its $2.2bn budget for fiscal 2011.
The tax, which ends months of debate about how to close the city’s huge budget deficit, is a compromise between Mayor Stephanie Rawlings-Blake’s earlier proposal for a four-cent tax per bottle and council members who had been pressured by beverage industry groups to reject the tax. The amendment was offered by Councilwoman Helen Holton, who had previously voted against the four-cent tax, allowing the compromise tax to pass.
The two-cent Beverage Container Tax is due to expire in three years.
Baltimore City Council president Bernard C. “Jack” Young said in a statement that the budget would help preserve the city’s services and jobs through a balance of cost-cutting and revenue-raising measures.
Young said: “These choices have been tough, but are necessary in order to help the city emerge stronger and better-positioned for the future.”
The council passed the measure 8-4, and Young abstained from the vote.
Baltimore has a projected budget deficit of $121m. Young said that $44m would be generated through revenue-raising measures, and a further $70m would be raised through spending reductions. The two-cent bottle tax would raise an estimated $5.7m for the city – it exempts large two-liter bottles of soda as well as milk and juices.
Similar moves have been rejected in Philadelphia and Washington, following pressure from beverage distributors and retailers.