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02/24/2020

British Columbia implements tax on carbonated beverages

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Starting on Canada Day, British Columbia will add provincial sales tax to all carbonated beverages that contain sugar.

The new rules span bottled and canned soda, as well as beverages dispensed through soda fountains, soda guns and vending machines.

Finance Minister Carole James announced in her budget last week that the 7% provincial sales tax will takes effect on July 1 and is expected to generate $27 million in revenues in the 2020-2021 budget year.

Belgium, United Kingdom, Mexico, Chile, France, Portugal, Norway and Hungary charge an excise tax of 20% on such drinks, while eight cities in the United States also levy sugar taxes, including Berkeley, Calif., where a University of California study published last year in the American Journal of Public Health found sugar-drink consumption was down almost 52% in some neighbourhoods and water consumption was up 29%.

The B.C. tax comes after pressure from health care professionals. B.C. Health Minister Adrian Dix said the tax encourages healthy behaviours and provides revenue to help fund government health programs.

"It makes a statement to society that sugary drinks should not be treated as tax exempt food like say an apple,'' he said. "t sends the right message. It provides some deterrence to the purchase of things that are unhealthy, and it provides support for health programs."

With files from Canadian Press