Sugar-sweetened beverages

AN ACT Relating to creating a hunger free Washington through a 1
sugar-sweetened beverage tax and precluding a supplemental nutrition 2
assistance program waiver; amending RCW 82.84.040; adding a new 3
section to chapter 43.20A RCW; adding a new chapter to Title 82 RCW; 4
and creating a new section. 5
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:6
NEW SECTION. Sec. 1. (1) The legislature finds that:7
(a) Sugar-sweetened beverage consumption contributes to 8
preventable chronic disease, including obesity, type 2 diabetes, 9
cardiovascular disease, fatty liver disease, and dental caries, and 10
imposes significant costs on individuals, families, employers, and 11
public health systems; 12
(b) Sugar-sweetened beverages are the largest single source of 13
added sugars in the American diet and among the top sources of 14
calories. Further, sources of liquid sugars may be uniquely harmful 15
to health because of the way liquid sugars are metabolized;16
(c) Health risks due to sugar-sweetened beverage consumption are 17
particularly pronounced among children, adolescents, lower income 18
populations, and communities of color including Black, Hispanic, 19
Native Americans, Alaska Natives, and Native Hawaiians and Pacific 20
H-3430.1
HOUSE BILL 2734
State of Washington 69th Legislature 2026 Regular Session
By Representatives Street, Ramel, Wylie, Macri, Peterson, Pollet, and
Ormsby
Read first time 02/06/26. Referred to Committee on Finance.
p. 1 HB 2734
Islanders due to targeted marketing, socioeconomic disparities, and 1
increased exposure to unhealthy beverages; 2
(d) Meanwhile, food insecurity is rising in communities across 3
Washington state as more households are struggling with higher food 4
and housing costs, and more households are struggling to afford 5
enough food, including nutritious foods that support long-term health 6
and well-being. Eleven percent of all Washingtonians are food 7
insecure, and findings by the University of Washington show that the 8
food insecurity rate among low-income and moderate-income people is 9
55 percent, five times higher than among the population as a whole, 10
and that food insecurity rates among Hispanic, Black, and Native 11
American households were as much as five to seven times greater than 12
the average Washington household; 13
(e) Diet-related disease and food insecurity are closely linked 14
and are influenced by unequal access to affordable, healthy food, 15
targeted marketing practices, and disparities in income, housing 16
stability, and health care access; 17
(f) Public health evidence indicates that excise taxes on sugar-18
sweetened beverages can reduce sales of these beverages (as 19
demonstrated in places like Seattle, Washington; Philadelphia, 20
Pennsylvania; and Berkeley, California) and generate dedicated 21
revenue that can be invested to improve food security, nutrition, and 22
public health; 23
(g) A study looking at taxes paid and benefits received from 24
programs supported with sugar-sweetened tax revenues by people with 25
lower and higher incomes in three cities found the net tax effect was 26
to redistribute dollars from higher to lower income households, 27
suggesting a sugar-sweetened beverage tax is a progressive, equitable 28
public policy when tax revenues are intentionally invested in 29
communities with lower incomes; 30
(h) Food insecurity disproportionately impacts families with 31
young children, seniors living alone, people of color, and rural 32
residents. Reducing food insecurity leads to reduced behavior 33
problems and better academic outcomes for children, improved mental 34
health, reduced anxiety and depression, improved maternal health, and 35
improved health and independent living for seniors; and36
(i) Food and nutrition assistance programs, including the 37
supplemental nutrition assistance program, are among the most 38
effective tools for reducing food insecurity, improving diet quality, 39
and supporting local economies, and maintaining stable funding for 40
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these programs is a matter of statewide public interest. Despite the 1
importance of these programs to the state, there is currently no 2
dedicated source of funding. Additionally, federal changes decreasing 3
funding and increasing costs associated with administering these 4
programs are further jeopardizing the state's ability to maintain 5
this vital public good. 6
(2) Therefore, it is the intent of the legislature to impose an 7
excise tax on sugar-sweetened beverages to: 8
(a) Establish a dedicated source of revenue to support food 9
security and nutrition assistance programs for low-income populations 10
and communities of color disproportionately affected by food 11
insecurity and unequal access to affordable, nutritious food;12
(b) Direct revenues from the tax to fund and administer the 13
supplemental nutrition assistance program, the food assistance 14
program, the fruit and vegetable incentives program established under 15
RCW 43.70.780, and other programs that increase food security and 16
access to affordable, nutritious foods for populations most impacted 17
by socioeconomic and health disparities; 18
(c) Reduce the sales and consumption of sugar-sweetened beverages 19
and lower rates and burden of obesity, diabetes, cardiovascular 20
disease, tooth decay, and other adverse health conditions associated 21
with the consumption of these beverages; and 22
(d) Clarify and restore the authority of local governments who 23
established a sweetened beverage tax before January 1, 2018, to 24
impose, administer, and adjust local sweetened beverage taxes 25
consistent with the terms of this chapter. 26
NEW SECTION. Sec. 2. DEFINITIONS. The definitions in this 27
section apply throughout this chapter unless the context clearly 28
requires otherwise.29
(1)(a) "Beverage for medical use" means: 30
(i) A beverage suitable for human consumption and manufactured 31
for uses as an: 32
(A) Oral nutritional therapy for persons who cannot absorb or 33
metabolize caloric or dietary nutrients from usual food or beverages; 34
or 35
(B) Oral rehydration electrolyte solution formulated to prevent 36
or treat dehydration due to illness; or 37
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(ii) Any beverage that meets the statutory definition of "medical 1
food" under the orphan drug act of 1983, 21 U.S.C. Sec. 360ee (b)(3), 2
as amended, as of the effective date of this section.3
(b) "Beverage for medical use" does not include drinks commonly 4
referred to as "sports drinks" or any other common names that are 5
derivations thereof. 6
(2) "Caloric sweetener" means any substance or combination of 7
substances that contains calories, is suitable for human consumption, 8
and humans perceive as sweet. Caloric sweeteners include, but are not 9
limited to: Granulated white sugar, brown sugar, sucrose, dextrose, 10
fructose, glucose, and other monosaccharides and disaccharides; corn 11
syrup or high fructose corn syrup; honey; molasses; xylem sap of 12
maple trees; agave nectar; and any other such substance designated by 13
the department. 14
(3) "Concentrate" means a syrup, powder, frozen or gel mixture, 15
or other product containing one or more sweeteners as an ingredient, 16
intended to be used in making, mixing, or compounding a sugar-17
sweetened beverage by combining the concentrate with one or more 18
other ingredients. 19
(4) "Consumer" means a natural person who purchases a sugar-20
sweetened beverage product in the state for a purpose other than 21
resale in the ordinary course of business and for sale to another.22
(5) "Distribution" or "distribute" means to supply to a 23
distributor or retailer, deliver to a retailer, facilitate 24
acquisition by a retailer, or transport into the state for the 25
purpose of selling any sugar-sweetened beverage in the state, or any 26
combination of these activities. 27
(6) "Distributor" means any person, including a manufacturer, 28
bottler, or wholesale dealer, that distributes sugar-sweetened 29
beverages in the state for sale to retailers that operate businesses 30
in the state, regardless of whether the person also offers sugar-31
sweetened beverages for retail sale. 32
(7) "Milk" means natural fluid milk, regardless of animal sources 33
or butterfat content; natural milk concentrate, whether or not 34
reconstituted, regardless of animal source or butterfat content; or 35
dehydrated natural milk, whether or not reconstituted and regardless 36
of animal source or butterfat content; and plant-based milk 37
substitutes that are marketed as milk, such as, but not limited to, 38
soy milk, coconut milk, rice milk, and almond milk.39
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(8) "Nonalcoholic beverage" means a beverage suitable for human 1
consumption and that is not liquor as defined in RCW 66.04.010.2
(9) "Retailer" means any person who serves sugar-sweetened 3
beverages to a consumer. 4
(10)(a) "Sugar-sweetened beverage" means any beverage intended 5
for human consumption that contains one or more caloric sweeteners, 6
whether in bottles, prepared from concentrates, served as a fountain 7
beverage, or in any other form. 8
(b) "Sugar-sweetened beverage" includes all drinks and beverages 9
commonly referred to as soda, pop, cola, soft drinks, sports drinks, 10
energy drinks, fruit drinks, sweetened ice teas and coffees, and 11
other products with added caloric sweeteners including, but not 12
limited to, juice with added caloric sweetener, flavored water with 13
added caloric sweetener, and nonalcoholic beverages that may or may 14
not be mixed with alcohol or any other common names that are 15
derivations thereof. 16
(c) "Sugar-sweetened beverage" does not include any of the 17
following: 18
(i) Any beverage in which natural milk is the primary ingredient, 19
in other words, the ingredient listed first in the product ingredient 20
list; or in which water and grains, nuts, legumes, or seeds 21
constitute the first two ingredients in the product ingredient list;22
(ii) Any beverage for medical use; 23
(iii) Any liquid sold for use as a meal replacement for weight 24
reduction or other purposes; 25
(iv) Any product commonly referred to as infant formula or baby 26
formula; 27
(v) Any alcoholic beverage; 28
(vi) Any beverage consisting of 100 percent natural fruit or 29
vegetable juice with no added sweetener. For the purposes of this 30
subsection (10)(c)(vi), natural fruit juice and natural vegetable 31
juice mean the original liquid resulting from the pressing of fruits 32
or vegetables; 33
(vii) Any concentrate that the consumer combines with other 34
ingredients to create a beverage; 35
(viii) Any beverage that contains fewer than 20 calories per 12 36
ounce serving; or 37
(ix) Sweetened medication such as cough syrup, liquid pain 38
relievers, fever reducers, and similar products. 39
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NEW SECTION. Sec. 3. TAX IMPOSED. (1) Beginning January 1, 1
2028, there is a tax imposed upon every person engaging within this 2
state in the business of distributing sugar-sweetened beverages. The 3
tax must be paid upon the first nonexempt distribution of a sugar-4
sweetened beverage in the state. However, if a distributor or a 5
retailer receives taxable products on which the tax has not been 6
paid, the distributor or retailer is liable for the tax. The amount 7
of tax with respect to such business is equal to the volume of sugar-8
sweetened beverages the distributor distributes in the state 9
multiplied by the applicable tax rate in subsection (2) or (3) of 10
this section.11
(2) For sugar-sweetened beverages that are produced from 12
concentrates, the tax is calculated using the largest volume of 13
beverage that would typically be produced by the amount of 14
concentrate distributed based on the manufacturer's instructions or 15
industry practice. Where a product is produced from more than one 16
concentrate, the rate on each component must be calculated 17
proportionately, so that the combined tax on the total yields a tax 18
rate per fluid ounce of resulting beverage as provided under 19
subsection (3) of this section. 20
(3) For all sugar-sweetened beverages, the tax rate is $0.03 per 21
fluid ounce of sugar-sweetened beverages the distributor distributes.22
(4) The tax collected under this chapter must be deposited into 23
the hunger free Washington account created in section 9 of this act.24
NEW SECTION. Sec. 4. EXEMPTIONS. (1) If a person, who is a 25
member of an affiliated group that files a federal consolidated 26
return, pays the tax imposed by section 3 of this act on a 27
distribution of sugar-sweetened beverages, then subsequent transfers 28
of those sugar-sweetened beverages from that person to members of the 29
affiliated group are not subject to the tax imposed by section 3 of 30
this act. For the purposes of this subsection, "affiliated group" has 31
the same meaning as provided in 26 U.S.C. Sec. 1504 (a), as amended, 32
as of the effective date of this section.33
(2) Persons who are exempt from taxation by the state pursuant to 34
federal or state statutes are exempt from the tax imposed by this 35
chapter. 36
NEW SECTION. Sec. 5. GENERAL EXCISE TAX IN ADDITION TO OTHER 37
LICENSE FEES AND TAXES. (1) The tax imposed by section 3 of this act 38
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is a general excise tax on the privilege of conducting certain 1
business within the state. It is not a sales tax or use tax or other 2
excise tax on the sale, consumption, use, or gross receipts of sugar-3
sweetened beverages. 4
(2) The tax imposed by section 3 of this act is in addition to 5
any license fee or tax imposed or levied under any other law.6
NEW SECTION. Sec. 6. CREDITS. (1) A distributor may take a 7
credit against the tax due under this chapter for the amount of any 8
similar sugar-sweetened beverage tax imposed by a city in Washington 9
that has a sweetened beverage tax in place before 2018 on the same 10
sugar-sweetened beverages during the same reporting period. The 11
credit may not exceed the tax due under this chapter.12
(2) A distributor may take a credit against the tax due under 13
this chapter for any tax paid under RCW 82.64.020 for the same sugar-14
sweetened beverage during the same reporting period. The credit may 15
not exceed the tax due under this chapter. 16
NEW SECTION. Sec. 7. PARITY AUTHORITY. A city with an existing 17
sweetened beverage tax may, by ordinance, adjust its local 18
definitions of taxable products, tax rates, exemptions, and 19
administrative procedures to achieve parity with the definitions, 20
procedures, and rate established under this chapter.21
NEW SECTION. Sec. 8. RULES. Chapter 82.32 RCW applies to the 22
tax imposed in this chapter. The tax due dates, reporting periods, 23
and return requirements applicable to chapter 82.04 RCW apply equally 24
to the tax imposed in this chapter. The department must adopt 25
additional rules, as necessary, for the purpose of carrying out the 26
provisions of this chapter including, but not limited to: Rules to 27
clarify the inclusion or exclusion of particular products and the 28
calculation of tax for concentrates based on manufacturer's 29
instructions or industry practice; rules to implement the tax rates 30
provided under section 3 of this act; and rules to designate caloric 31
sweeteners.32
NEW SECTION. Sec. 9. A new section is added to chapter 43.20A 33
RCW to read as follows: 34
(1) The hunger free Washington account is created in the state 35
treasury. Moneys collected from the tax imposed on sugar-sweetened 36
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beverages under section 3 of this act must be deposited into the 1
account. Moneys in the account may be spent only after appropriation. 2
Moneys in the account shall only be used to fund and administer the 3
following food security and nutrition programs: 4
(a) The supplemental nutrition assistance program under chapter 5
74.04 RCW; 6
(b) The food assistance program under RCW 74.08A.120;7
(c) The fruit and vegetable incentives program established under 8
RCW 43.70.780; 9
(d) Free and reduced school meals required under RCW 28A.235.135, 10
28A.235.300, and 28A.235.160 and elimination of breakfast copays;11
(e) Farm-to-school programs under RCW 28A.235.180 and 15.64.060.12
(2) All moneys in the account must be expended only for the 13
purposes expressed in this section and must be used only to 14
supplement existing levels of service. Moneys in the account may not 15
supplant any federal, state, or local funding for existing levels of 16
service. 17
NEW SECTION. Sec. 10. The department of social and health 18
services or any other state agency may not seek a waiver or 19
demonstration project from the United States department of 20
agriculture to exclude the purchase of any sugar-sweetened beverages 21
subject to the tax imposed under section 3 of this act from the 22
definition of eligible foods under 7 C.F.R. Sec. 271.2.23
Sec. 11. RCW 82.84.040 and 2019 c 2 s 4 are each amended to read 24
as follows: 25
Notwithstanding any other law to the contrary:26
(1) Except as provided in subsections (2) through (4) of this 27
section, a local governmental entity may not impose or collect any 28
tax, fee, or other assessment on groceries. 29
(2) Nothing in this section precludes the continued collection of 30
any existing tax, fee, or other assessment on groceries as is in 31
effect as of January 15, 2018; but no existing tax, fee, or other 32
assessment on groceries may be increased in rate, scope, base, or 33
otherwise after January 15, 2018, except as provided in subsections 34
(3) and (4) of this section and section 7 of this act.35
(3) Nothing in this section prohibits the imposition and 36
collection of a tax, fee, or other assessment on groceries if:37
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(a) The tax, fee, or other assessment is generally applicable to 1
a broad range of businesses and business activity; and2
(b) The tax, fee, or other assessment does not establish or rely 3
on a classification related to or involving groceries or a subset of 4
groceries for purposes of establishing or otherwise resulting in a 5
higher tax rate due to such classification. 6
(4) Nothing in this section prohibits the imposition and 7
collection of a local retail sales and use tax pursuant to RCW 8
82.14.030 on those persons taxable by the state under chapters 82.08 9
and 82.12 RCW. 10
NEW SECTION. Sec. 12. RCW 82.32.805 and 82.32.808 do not apply 11
to this act.12
NEW SECTION. Sec. 13. Sections 1 through 8 and 10 of this act 13
constitute a new chapter in Title 82 RCW.14
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