Here's What Would Be Taxed -- or Not -- in SF, Berkeley Soda Tax Measures

Both San Francisco and Berkeley have measures on their November ballots that would institute a tax on sugar-sweetened beverages. With less than a week to go until Election Day, we're getting down to the nitty-gritty. People want to know exactly what will be taxed -- and what won't.

First things first: The tax is on sugar-sweetened beverages, so diet sodas would not be taxed. After all, they do not have sugar or any other sweetener that has calories. Maybe the moniker "soda tax" is misleading here.

To find out if your favorite beverage would be taxed, ask yourself the following:

• Does this drink contain added sugar (or another caloric sweetener such as high-fructose corn syrup)?
• Does this drink have significant nutritional value (such as, say, milk does)?

If you answer "yes" to the first question and "no" to the second, your beverage is most likely subject to the proposed tax.

Here are drinks that are subject to the tax (farther down are exempt drinks):

Sodas -- such as regular Coke, Pepsi, 7 Up, etc. (But not diet sodas.) This includes sodas in bottles and cans, as well as  fountain drinks. Both the Berkeley and San Francisco measures call for taxing the syrup used to make fountain drinks. The syrup is taxed according to the largest volume, in fluid ounces, that could be produced from the sugar-sweetened syrup. For example, if a distributor sells a 12-ounce bottle of syrup and that syrup can be used to make 144 ounces of beverage, the tax is levied on the 144 ounces of beverage.

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Sports drinks, such as Gatorade. While the Gatorade label says that there are 14 grams of sugar in each 8-ounce serving, the bottles above are 20-ounces each. That means there are 35 grams of sugar in the bottle -- the equivalent of almost nine teaspoons of sugar. Energy drinks often are sugar-sweetened as well. Ditto, Vitamin Water.

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Sweetened teas are especially popular with teens. The 23.5-ounce can of Arizona Green Tea pictured above contains 51 grams of sugar -- that's more than one-third of a cup. It would be subject to the tax.

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While 100 percent juice drinks are exempt from the tax (see further below), drinks that contain less than that are subject to the tax. For example, according to the Sunny D nutrition label, the product contains 5 percent juice -- and added high-fructose corn syrup. The added corn syrup triggers the tax.

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San Francisco's Proposition E would levy a 2-cents-per-ounce tax on sugar-sweetened beverages that have at least 25 calories per 12-ounce drink. The tax revenue generated is earmarked to be spent on health programs. Since the tax is earmarked, it needs a two-thirds supermajority to pass.

Berkeley's Measure D would levy a penny-per-ounce tax. Berkeley's tax would be levied on sugar-sweetened beverages that contain at least two calories per ounce. The tax revenue generated would go into the general fund, but Measure D also mandates the creation of a health panel to advise the city on health programs to fund. Because the tax is not earmarked for specific programs, it requires a simple majority to pass -- 50 percent plus one vote.

Both taxes are levied on the distributor of the beverages. The presumption its that the tax would ultimately be paid by consumers.

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The San Francisco and Berkeley measures exempt certain categories of drinks from the tax. Those exempted products are as follows:

Infant formula. Full disclaimer that I have no idea whether that bottle actually contains infant formula or breast milk. But you get the idea. Infant formula is not subject to a sugar-sweetened beverage tax.

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100 percent fruit juices are not subject to the tax. Neither are 100 percent vegetable juice or 100 percent fruit and vegetable drinks. Why? They do not have added sugar or other caloric sweeteners.

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All milk products, including milk alternatives such as soy milk or almond milk. Yes, this includes flavored milk, including chocolate milk. All milk products would be exempt from the tax.

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Meal replacement drinks and so-called medical foods, as well as weight-loss products, are exempt from the tax.

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Alcohol would be exempt from the tax. The state of California already taxes alcohol, and according to the state board of equalization, state law prohibits local jurisdictions from imposing excise taxes on alcohol.

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Flavored coffee drinks. This category of beverages is the only one I've found that is somewhat tricky. If the drinks are pre-bottled and have added sugar, they are subject to the tax. But if they are made by a barista at, say, Starbucks, then the Berkeley and San Francisco measures handle coffee drinks differently.

In San Francisco, drinks prepared one by one (in other words, not pre-packaged) would not be taxed. The campaign manager for Yes on Proposition E told me that trying to assess the number of pumps of sweetener for each drink would pose an administrative burden on businesses.

But Berkeley would tax flavored coffee drinks made individually. The distributor would pay a tax based on the quantity of sweetener used according to the printed instructions. For example, Starbucks likely provides instruction about how many pumps of sweetener to put in each drink. The distributor would pay a tax according to that calculation.

If you buy an unsweetened coffee and then add the sweetener yourself, that additional sweetener is not taxed. In fact, if you buy any drink and add sugar or other caloric sweetener to it after you have purchased it, the additional sweetener will not be taxed. The tax is on the beverage, not on the sugar an individual adds to it.

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People can debate the merits of a sugar-sweetened beverage tax. The American Beverage Association is spending big to defeat these taxes. One of its strategies, especially in Berkeley, is to insist that Measure D contains "loopholes," and that it's confusing.

I frankly don't find it confusing. If your favorite drink contains added sugar and has little other nutritional value, then more than likely it is subject to the tax. If it has nutritional value, such as milk or meal replacement drinks, it is not.