Bill Text: OR HB2331 | 2013 | Regular Session | Introduced

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Bill Title: Relating to the taxation of sugar-sweetened beverages; appropriating money; prescribing an effective date; providing for revenue raising that requires approval by a three-fifths majority.

Spectrum: Partisan Bill (Democrat 5-0)

Status: (Failed) 2013-07-08 - In committee upon adjournment. [HB2331 Detail]

Download: Oregon-2013-HB2331-Introduced.html

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     77th OREGON LEGISLATIVE ASSEMBLY--2013 Regular Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 852

                         House Bill 2331

Sponsored by Representatives GREENLICK, TOMEI; Representatives
  BAILEY, BUCKLEY, GALLEGOS, KENY-GUYER (Presession filed.)

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.

  Imposes excise tax on sale of sugar-sweetened beverages and
concentrates. Allows local governments to impose taxes on
sugar-sweetened beverages or concentrates and provides for
agreements between local governments and Department of Revenue
for implementation of taxes. Establishes Sugar-Sweetened Beverage
Tax Fund for purpose of distributing proceeds of tax. Establishes
Health Promotion Fund to support programs designed to reduce and
prevent obesity. Transfers proceeds of tax to Health Promotion
Fund, Department of Human Services, Department of Education and
General Fund.
  Applies to sugar-sweetened beverages and concentrates sold on
or after January 1, 2014.
  Takes effect on 91st day following adjournment sine die.

                        A BILL FOR AN ACT
Relating to the taxation of sugar-sweetened beverages;
  appropriating money; prescribing an effective date; and
  providing for revenue raising that requires approval by a
  three-fifths majority.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + As used in this section and sections 2 to 8 of
this 2013 Act:
  (1)(a) 'Base product' means a solid mixture of ingredients that
is combined with one or more other ingredients, including but not
limited to water, ice, syrup, simple syrup, fruits, vegetables,
fruit juice, vegetable juice and carbon dioxide or other gas, to
make a sugar-sweetened beverage.
  (b) 'Base product' does not include any of the following:
  (A) A product sold in powder or other nonliquid form that is
used solely in preparing coffee or tea and that does not contain
added caloric sweetener.
  (B) A product sold in powder form for consumption by infants
and commonly referred to as infant formula.
  (C) A product sold in powder form for use in weight reduction.
  (D) A product that contains milk, a milk product or a milk
substitute.
  (2) 'Caloric sweetener' means a caloric substance suitable for
human consumption that is perceived as sweet and includes, but is
not limited to, sucrose, fructose, glucose, other sugars and
concentrates.
  (3) 'Concentrate' means a syrup, simple syrup or other base
product that is intended for preparing a sugar-sweetened
beverage.
  (4) 'Concentrate manufacturer' means a person that manufactures
concentrate for sale in this state.
  (5) 'Container' means a closed or sealed container made of
glass, metal, paper, plastic or any other material, regardless of
the size or shape of the container.
  (6) 'Dietary aid' means a liquid product that is intended for
use as:
  (a) A replacement for a daily meal for the purpose of weight
reduction;
  (b) An oral nutritional therapy in cases where caloric and
dietary nutrients cannot be absorbed from food or metabolized;
  (c) A source of necessary nutrition used due to a medical
condition; or
  (d) An oral electrolyte solution for infants and children
formulated to prevent dehydration.
  (7) 'Distributor' means a person that:
  (a) Imports or causes to be imported into this state for use,
distribution, bottling, storage or sale any sugar-sweetened
beverage or concentrate; or
  (b) Bottles sugar-sweetened beverages or concentrates.
  (8) 'Doing business in this state' includes:
  (a) Maintaining, occupying or using in this state, permanently
or temporarily, directly or indirectly, or through a subsidiary
or agent, by whatever name called, an office, place of
distribution, sales or sample room or place, warehouse or storage
place or any other place of business.
  (b) Having a representative, agent, salesperson, canvasser or
solicitor operating in this state under the authority of the
distributor or its subsidiary for the purpose of selling,
delivering or taking orders for sugar-sweetened beverages or
concentrates.
  (9) 'Milk' means natural liquid milk, regardless of animal
source or butterfat content, and natural milk concentrate and
dehydrated natural milk, regardless of animal source or butterfat
content and whether or not reconstituted.
  (10) 'Milk product' means a liquid that has milk as the
predominant ingredient by weight in accordance with the
regulations of the United States Food and Drug Administration.
  (11) 'Milk substitute' means a liquid that is plant-based and
is intended by its manufacturer as a substitute for milk.
  (12) 'Natural fruit juice' means the original liquid resulting
from the pressing of fruit.
  (13) 'Natural vegetable juice' means the original liquid
resulting from the pressing of vegetables.
  (14) 'Nonalcoholic beverage' means a beverage that contains
less than one-half of one percent alcohol by volume.
  (15) 'Simple syrup' means a mixture of sugar and water.
  (16)(a) 'Sugar-sweetened beverage' means:
  (A) Any nonalcoholic beverage that is intended for human
consumption and that contains caloric sweetener; and
  (B) All drinks and beverages commonly referred to as cola,
ginger ale, lime, lemon, lemon-lime, root beer, soda, soda pop or
soft drinks.
  (b) 'Sugar-sweetened beverage' does not include any of the
following:
  (A) Beverages sweetened solely with noncaloric sweeteners.
  (B) Beverages consisting of water and 100 percent natural fruit
juice or 100 percent natural vegetable juice, with no added
caloric sweetener.
  (C) Any product sold in liquid form for consumption by infants
and commonly referred to as infant formula.
  (D) Water that is not carbonated and to which no substance has
been added except for minerals and noncaloric flavoring agents.
  (E) Any product containing milk, a milk product or a milk
substitute.
  (F) Any dietary aid.
  (17) 'Sugar-sweetened beverage manufacturer' means a person
that bottles, cans or otherwise fills containers with
sugar-sweetened beverages, or imports sugar-sweetened beverages
in containers.
  (18) 'Syrup' means a liquid mixture of ingredients that is
combined with water, simple syrup, ice, fruits, vegetables, fruit
juice, vegetable juice, another base product or any other product
to make a sugar-sweetened beverage. + }
  SECTION 2.  { + (1) An excise tax is imposed at the first sale
in this state of a sugar-sweetened beverage or concentrate by a
distributor, sugar-sweetened beverage manufacturer or concentrate
manufacturer doing business in this state. The tax is calculated
as follows:
  (a) For a sugar-sweetened beverage sold to a retailer for sale
in this state to a consumer, at a rate of $0.005 per ounce.
  (b) For concentrate sold to a retailer for sale in this state
to a consumer, either as concentrate or as a sugar-sweetened
beverage derived from that concentrate, at a rate of $0.005 per
ounce for each gallon of sugar-sweetened beverage produced from
the concentrate. For purposes of calculating the tax, the volume
of sugar-sweetened beverage produced from the concentrate shall
be the larger of the largest volume resulting from use of the
concentrate according to the manufacturer's instructions or the
volume actually produced by the retailer, as reasonably
determined by the Department of Revenue.
  (2) The tax amounts set forth in this section shall be adjusted
annually on or before July 1 by the Department of Revenue in an
amount equal to the increase for the previous calendar year in
the Consumer Price Index (Portland area -- all items) as
published by the Bureau of Labor Statistics of the United States
Department of Labor for the Portland, Oregon area.
  (3) A retailer that sells to a consumer sugar-sweetened
beverages or concentrate on which the tax imposed under
subsection (1) of this section has not been paid is liable for
the tax at the time of the sale to the consumer. + }
  SECTION 3.  { + The following shall be exempt from the tax
imposed under section 2 of this 2013 Act:
  (1) Sugar-sweetened beverages and concentrates sold to the
United States Government; and
  (2) Sugar-sweetened beverages and concentrates sold expressly
for resale or consumption outside this state. + }
  SECTION 4.  { + (1) The Department of Revenue shall collect the
tax imposed under section 2 of this 2013 Act, which shall be due
and payable to the department quarterly on or before the last day
of the month next succeeding each quarterly period.
  (2) The department may by rule adopt procedures for the
administration of the tax imposed under section 2 of this 2013
Act.
  (3) Any person that is liable for the tax imposed by section 2
of this 2013 Act shall, on or before the last day of the month
next succeeding each quarterly period, return to the department a
statement containing the name of the business and each place of
business, and the quantity of sugar-sweetened beverage or
concentrate subject to the tax imposed by section 2 of this 2013
Act and sold in the preceding quarter. The statement shall be
under oath of a person with legal authority to bind the person
liable for the tax and shall contain any other information
required by the department, along with the tax due. + }
  SECTION 5.  { + Except as otherwise provided in sections 2 to 8
of this 2013 Act or where the context requires otherwise, the
provisions of ORS chapters 305 and 314 as to the audit and
examination of returns, periods of limitation, determination of
and notices of deficiencies, assessments, liens, delinquencies,
claims for refund and refunds, conferences, appeals to the Oregon
Tax Court, stays of collection pending appeal, confidentiality of
returns and the penalties relative thereto, and the procedures
relating thereto, shall apply to the determinations of taxes,
penalties and interest under sections 2 to 8 of this 2013
Act. + }
  SECTION 6.  { + (1) Sections 2 to 8 of this 2013 Act are not
intended to preempt any local government from enacting any law,
rule, regulation or ordinance that taxes the manufacture,
distribution or sale of sugar-sweetened beverages or
concentrates.
  (2) The Department of Revenue may enter into agreements with
local governments for the collection, enforcement, administration
and distribution of local taxes imposed by local governments upon
the manufacture, distribution or sale of sugar-sweetened
beverages or concentrates. + }
  SECTION 7.  { + (1) All proceeds received by the Department of
Revenue from the tax imposed under section 2 of this 2013 Act
shall be credited to the Sugar-Sweetened Beverage Tax Fund
established in section 10 of this 2013 Act.
  (2) The Department of Revenue shall distribute:
  (a) 40 percent of the proceeds received to the Department of
Human Services for purposes of financing healthy nutrition
programs in schools and communities;
  (b) 20 percent of the proceeds received to the Health Promotion
Fund established in section 9 of this 2013 Act;
  (c) 20 percent of the proceeds received to the Department of
Education for purposes of financing physical education programs;
  (d) 10 percent of the proceeds received to the Department of
Human Services for purposes of financing community-based public
health activities; and
  (e) After the payment of refunds and administrative costs, the
remainder of the proceeds received to the General Fund. + }
  SECTION 8.  { + (1) The Director of the Department of Revenue
is authorized to enter into a sugar-sweetened beverage tax refund
agreement with the governing body of any Indian reservation in
Oregon. The agreement may provide for a mutually agreed upon
amount as a refund to the governing body of any tax collected
under sections 2 to 8 of this 2013 Act in connection with the
sale of sugar-sweetened beverages and concentrates to Indians on
the Indian reservation, or the use, storage or consumption of
sugar-sweetened beverages and concentrates by Indians on the
Indian reservation. This provision is in addition to other laws
allowing tax refunds.
  (2) There are continuously appropriated to the director, from
the Sugar-Sweetened Beverage Tax Fund established in section 10
of this 2013 Act, the amounts necessary to make the refunds
provided by subsection (1) of this section. + }
  SECTION 9.  { + The Health Promotion Fund is established in the
State Treasury, separate and distinct from the General Fund.
Moneys in the Health Promotion Fund are continuously appropriated
to the Oregon Health Authority and shall be expended to support
statewide evidence-based practices and programs that use
environmental, policy, educational and other public health
approaches to reduce and prevent obesity in this state. The
authority shall by rule adopt methods for the allocation of
moneys from the fund. + }
  SECTION 10.  { + The Sugar-Sweetened Beverage Tax Fund is
established in the State Treasury, separate and distinct from the
General Fund. Moneys in the Sugar-Sweetened Beverage Tax Fund are
continuously appropriated to the Department of Revenue for the
purpose of making the distributions and refunds under sections 7
and 8 of this 2013 Act. + }
  SECTION 11.  { + Sections 1 to 8 of this 2013 Act apply to
sugar-sweetened beverages and concentrates sold on or after
January 1, 2014. + }
  SECTION 12.  { + This 2013 Act takes effect on the 91st day
after the date on which the 2013 regular session of the
Seventy-seventh Legislative Assembly adjourns sine die. + }
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