Despite a last-minute plea by more than 500 employees of the state's beverage industry – including 25 workers from Corwin Beverage in Ridgefield – legislators in Olympia prepared this week to approve a tax increase on bottled water, soda and beer that many distributors claimed would force them to lay off workers and increase prices.
According to Corwin co-owner Heidi Piper-Schultz, the Ridgefield plant may have to shed up to 15 workers, mostly as a result of a two-cent levy on 12-ounce cans of soda that Piper-Schultz called particularly damaging to the fourth-generation family-owned company's bottom line.
"If you are a beverage distributor anywhere in this state, you just got nailed big time," she said of the tax increases, set to take effect
July 1.
Rep. Jim Moeller (D-Vancouver) defended his vote for the revenue-generating package, including the tax increase on soda, by dismissing a beverage industry argument that the hike would send more shoppers across state lines. "I'd be surprised if two cents will make a difference in people's spending habits," Moeller said.
However, Piper-Schultz said the measures covering soda and bottled water unfairly targeted a major Southwest Washington employer by raising Corwin's tax bill by an estimated $1.3 million. A distributor of over 300 bottled products, Corwin currently employs 115 workers at its Ridgefield facility.
Beverage companies weren't the only losers emerging from the recently-concluded special legislative session in Olympia. Together with a string of Business and Occupation tax increases, legislators voted to increase taxes on cigarettes, candy and gum.
Despite the tax increases, as well as a three-week legislative logjam between House and Senate Democrats over competing budget proposals, at least one local legislator was quick to put the final agreement in a positive light.
"In the end, we've cut more than five times more in services than we've raised in new revenues this biennium," said Sen. Craig Pridemore (D-Vancouver).
Pridemore also touted a successful effort by a group of mostly border-county Democrats in heading-off a repeal of the out-of-state sales tax exemption – a proposal that proved especially unpopular among some Vancouver business owners dependent on customers from sales tax-free Oregon.
However, that victory didn't keep one Republican legislator from blasting the Democrats' revenue-generating package, which the majority party hopes will lead to about $800 million in extra money this year for a state an estimated $2.8 billion in the red.
"This is a sad day for struggling families and employers," said Rep. Ed Orcutt (R-Kalama). "This tax increase represents the largest tax increase in state history and it will have a negative impact on our chances for economic recovery."
