Guam Chamber opposes bill to tax sweet drinks

The Guam Chamber of Commerce opposed the 37th Guam Legislature’s Bill No. 118-37 – introduced by Sen. Roy Quinata – which seeks to tax sugar-sweetened beverages and create a sports facilities fund. The public hearing for the bill was held on Sept. 21.

Catherine S. Castro, president of the chamber wrote, “First and foremost, I wish to draw attention to the significant impact this tax would have on local businesses, including restaurants, retailers, and distributors. These establishments are our community's backbone and have faced unprecedented challenges over the past few years.

“Their profit margins are already relatively slender and introducing a tax on sugary drinks would only exacerbate their financial burdens. Many of these businesses are still struggling to recover from the economic downturn caused by the pandemic, and the recent typhoon has only added to their woes. Why burden them further with additional taxes that could jeopardize their ability to keep employees on payroll and their doors open for business?”

View the chamber's full opposing testimony here.

 Businesspeople also opposed the tax, which would add 2¢ an ounce on drinks with added sugar, or about 24¢ to a 12-ounce can of soda. Syrups and beverage mixes would be similarly taxed.  

“Sin” tax hikes are also viewed as a way for governments to raise additional funds.

Similar proposed legislation to include a “sugar tax” in the Northern Mariana Islands in 2022, saw businesses warning that costs would be passed on to the consumer. The Saipan Chamber of Commerce opposed the beverage tax legislation.

In September 2022, the University of Georgia found that after legislation in 2017 in Philadelphia, while demand for drinks went down in the city, consumers turned to other sweetened products to “fill a sugar gap,” or bought drinks out of state. In Philadelphia the tax led to a 4% increase in purchases of other high-sugar goods in the city and neighboring towns.

The university said “low-income groups” shoulder a disproportionate burden of any cost increase. mbj

Editorial note:

Coca-Cola Beverage Co. (Guam) and Foremost Foods Inc. are sister are sister brands to Glimpses of Guam, which publishes the Journal.