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Pop tax fizzles out in committee

Pop tax fizzles out in committee

HELENA - On a 6-5 vote Tuesday, the Senate Taxation Committee tabled a bill that would have imposed a 5-cent tax on every 12 ounces of soda pop sold.

Senate Bill 332, by Sen. Don Ryan, D-Great Falls, would have raised anywhere from $20 million to $29 million a year in new taxes. Fifty percent of the proceeds would have gone into the state's aging-services program, 25 percent to the elderly Montanans trust fund and 25 percent for college scholarships for Montana students.

It marks the third major Democrat-sponsored tax increase bill tabled by the Democratic-controlled Senate Taxation Committee.

Last month, the same panel tabled SB343, by Sen. Mike Wheat, D-Bozeman, which would have raised the state tax on beer by $16 million a year to fund alcohol and drug treatment and prevention programs.

The committee also tabled SB248, by Sen. Ken Toole, D-Helena, that would have raised $40 million a year by doubling the tax on video gambling machines from 15 percent to 30 percent on the sixth through 20th gambling machines. It would have targeted the proceeds for property tax relief through an income tax credit for homeowners and renters.

A tabled bill can be blasted out of committee onto the Senate floor, but it would take 26 votes on the floor of the 50-member Senate, where Democrats have a 27-23 margin. A tax increase is expected to be a tough sell in the House, which is split 50-50 between Republicans and Democrats.

And if a tax hike should make it out of the House and Senate, Democratic Gov. Brian Schweitzer has repeatedly vowed he will veto any tax increases because the state doesn't need them to balance the budget.

All Democrats on the committee voted for the pop tax, except for Sen. Trudi Schmidt of Great Falls. She joined the panel's five Republicans to table a bill.

Pop tax bills have been introduced nearly every session at the Legislature the past decade or so, but none has ever passed. The pop bottling and distributing industry attacks the tax as a selective sales tax unfairly targeted at one industry, while advocates say the bill would provide money to fund needed social services.

"Obviously, we were very pleased with the committee vote,” said Elaine Taylor, lobbyist for the Montana Beverage Association, which opposed the bill.

However, Taylor added, her group isn't taking anything for granted yet. "Until they leave town, then we'll completely have our sigh of relief,” she said.

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