Health Care Committee brings sugar-sweetened beverage tax back to life

February 27, 2013

Posted By Andrew Stein On February 27, 2013

In dramatic fashion, the House Health Care Committee voted on Wednesday to resurrect a comprehensive budget bill from a premature “death.”

The committee’s approval advances a penny per ounce tax on sugar-sweetened beverages, a $4.5 million state subsidy for low-income health insurance and the repeal of an employer assessment for companies that don’t provide health insurance for employees. To learn more about the assessment and the other items, click here. [2]

Last Friday, the committee voted down the bill in a 5-5 stalemate. [3] The vote was split between solid Democratic support for the legislation and opposition from three Republicans, one independent and one Progressive.

The tie was, in part, a result of Rep. George Till, D-Jericho, abruptly leaving before the vote. Although his fellow legislators were under the impression that the committee’s only physician member left to deal with an emergency, Till said he left in an attempt to stall the vote and build support for increased subsidies or the current bill. [4]

While the committee’s three Republican members felt the bill went too far, Progressive Rep. Chris Pearson of Burlington and Rep. Paul Poirier, I-Barre, didn’t think it went far enough.

The liberally leaning Poirier and Pearson took issue with the low-income subsidies, which are part of the bill that passed and would provide significantly less health insurance coverage for Vermonters who earn $15,300 to $34,500 annually and who now rely on the Catamount Health and Vermont Health Access Plan programs that will disappear once the state’s health care exchange goes into effect next year. [5]

“I feel very strongly that this is the first step down a bad road, and I don’t want to go down that road,” Poirier said on Wednesday about the implications that the lower subsidies might have for the future of Vermont’s health care reform efforts.

The Republicans had qualms about the tax proposals. They welcomed the repeal of the employer assessment, but they staunchly opposed a sugar-sweetened beverage tax.

The committee voted on Wednesday to break the bill into two parts: the low-income subsidies and the sugar-sweetened beverage tax, which included the repeal of the employer assessment.

Both items passed 7-4, and they were combined back into one bill.

For the first time this session, the committee’s three Republican members split a vote.

Although the three Republicans opposed the subsidies last week, Reps. John Mitchell, R-Fairfax, and Mary Morrissey, R-Bennington, voted for the subsidy this week. Rep. Doug Gage, R-Rutland, joined Poirier, Pearson and Till in voting against the subsidy level.

None of the Republican representatives were immediately available for comment after the vote. Poirier, Pearson and Till sought an increased subsidy.

Pearson joined Till and the other Democrats in voting for the sugar-sweetened beverage tax, which could raise roughly $27 million. [6] All of the Republican members voted against the sugar-sweetened beverage tax, and Poirier, who introduced the repeal of the assessment, joined them.

For Till, the sugar-sweetened beverage tax was the bill’s linchpin.

“I think it’s a much better alternative to employer assessments,” he said. “Taxes, which serve other policy goals, make much more sense than just general taxes. And this serves the policy goals of reducing obesity. It’s fine if you want to drink sugar-sweetened beverages, but you ought to be willing to pay for that; the same with smoking cigarettes.”

The bill is next slated for the House Ways and Means Committee, which is the only committee in the General Assembly with the power to write tax legislation. Gov. Peter Shumlin opposes the sugar sweetened beverage tax.