Internet Explorer 11 is not supported

For optimal browsing, we recommend Chrome, Firefox or Safari browsers.

Retailers Sued for Allegedly Overusing Cook County's Soda Tax

The parent of Jewel-Osco was sued Friday for allegedly applying Cook County's new sweetened-beverage tax to purchases made with federal food stamps, transactions that are supposed to be exempt from the penny-per-ounce tax.

By Becky Yerak

The parent of Jewel-Osco was sued Friday for allegedly applying Cook County's new sweetened-beverage tax to purchases made with federal food stamps, transactions that are supposed to be exempt from the penny-per-ounce tax.

Annie Morales and Antonia Morales sued Albertsons in Cook County Circuit Court, alleging that on Sunday they bought lemonade through the Supplemental Nutrition Assistance Program and were charged the tax.

Each of the four bottles of lemonade they bought is subject to a Cook County sweetened beverage tax of 67 cents, for a total tax of $2.68, but because they paid for the lemonade with food stamps, they shouldn't have been charged the sweetened beverage tax, the lawsuit says.

Snafus related to the sweetened beverage tax and food stamps might become less common in the future.

On Thursday, Cook County officials said they've solved a problem with the sweetened beverage tax that put roughly $87 million in funding used to run the federal food stamp program in Illinois at risk of being withheld.

The county's regulation originally gave stores that hadn't been able to program point-of-sale systems not to tax those purchases the option of charging the tax and then issuing a refund.

But the U.S. Department of Agriculture's Food and Nutrition Services, which oversees the food stamp program, warned state officials last week that allowing refunds ran afoul of rules barring retailers from charging SNAP recipients the tax at any time.

The county solved the issue by striking language permitting refunds from the regulation, which "will ensure ongoing access of SNAP benefits for eligible Illinois households," county spokesman Frank Shuftan said Thursday.

Albertsons had no immediate comment.

Also Friday, Subway joined Walgreens and 7-Eleven on a list of retailers that have been sued for taxing unsweetened beverages. Another retailer, Circle K, has been sued over its application of the tax.

(c)2017 the Chicago Tribune

Caroline Cournoyer is GOVERNING's senior web editor.
Special Projects
Sponsored Stories
The 2021 Ideas Challenge recognizes innovative public policy that positively impacts local communities and the NewDEAL leaders who championed them.
Sponsored
Drug coverage affordability really does exist in the individual Medicare marketplace!
Sponsored
Understand the differences between group Medicare and individual Medicare plans and which plans are best for retirees.
Sponsored
For a while, concerns about credit card fees and legacy processing infrastructure might have slowed government’s embrace of digital payment options.
Sponsored
How expanded financial assistance, a streamlined application process and creative legislation can help Black and brown-owned businesses revive communities hit hardest by the pandemic.
Sponsored
In recent years, local governments have been forced to adapt to a wildly changing world, especially as it pertains to sending bills and collecting payments.
Sponsored
Workplace safety is in the spotlight as government leaders adapt to a prolonged pandemic.
Sponsored
While government employees, students and the general public had to wait in line for hours in the beginning of the pandemic, at-home test kits make it easy to diagnose for the novel coronavirus in less than 30 minutes.
Sponsored
Governments around the nation are working to design the best vaccine policies that keep both their employees and their residents safe. Although the latest data shows a variety of polarizing perspectives, there are clear emerging best practices that leading governments are following to put trust first: creating policies that are flexible and provide a range of options, and being in tune with the needs and sentiments of their employees so that they are able to be dynamic and accommodate the rapidly changing situation.