New York State's proposed tax on soda, energy drinks and sports beverages is riling industry and retailers opposed to what they call a regressive and economically damaging levy. But industry also may have questions about exactly what the dedicated tax means by excluding "dietary aids" and where liquid dietary supplements, medical foods and other nutritional products would fall.
Gov. David Paterson's 2010-2011 executive budget proposal notes on page 130 that "New York can make great strides in combating the obesity epidemic by applying lessons learned in our battle against tobacco," which the state has heavily taxed. Hence, the proposed tax of about $.01 per ounce of bottled soft drinks and other sugary beverages lacking a certain amount of fruit or vegetable juice.
A coalition of New York retailers oppose the tax and the American Beverage Association rejects the idea of the tax reducing obesity rates. We noted the public health arguments in favor of such a policy here.
Does dietary aid refer to a medical food? That happens to be another gray area FDA is looking to clarify, with a warning letter last month to Nestle regarding labeling for its Boost Kid Essentials Nutritionally Complete Drink, as we reported here.
Perhaps dietary aid points to a product like Abbott's Ensure, which has vitamins and minerals but also is loaded with sugar and not labeled as a dietary supplement. Might such nutritional products end up taxed in New York?
Looks like the Empire State may be cracking open a bigger can of worms than it realizes...
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- Dan Schiff (d.schiff@elsevier.com)
