Which States and Cities Have a Sugar Tax?

No U.S. state currently imposes a statewide sugar tax on beverages. The taxes that do exist sit at the local level: eight cities, the District of Columbia, and the Navajo Nation. Four states have moved in the opposite direction, passing laws that bar their cities from creating new ones. Here is where the states and cities with a sugar tax stand today, and how each version works.

Cities That Tax Sugary Drinks

Every active sugar tax in the continental United States is a city tax. Berkeley, California was first, with a one-cent-per-ounce tax that took effect January 1, 2015.¹ Three other California cities followed in 2017 at the same rate: Albany, Oakland, and San Francisco.² Santa Cruz is the newest to join. Voters there approved Measure Z in November 2024 at two cents per ounce.

Four cities outside California also tax sweetened beverages, each at a different rate:

Boulder, Colorado charges two cents per ounce, effective July 1, 2017. Revenue is directed to health promotion, wellness programs, and chronic disease prevention.³
Philadelphia, Pennsylvania charges 1.5 cents per ounce, effective January 1, 2017. Philadelphia is unusual because the tax covers both sugar-sweetened and artificially sweetened drinks, including diet sodas.⁴
Seattle, Washington charges 1.75 cents per ounce, effective January 1, 2018. The tax generated about $20 million in 2024.⁵

That brings the count to eight city taxes: Berkeley, Albany, Oakland, San Francisco, Santa Cruz, Boulder, Philadelphia, and Seattle.

Washington, D.C.

The District of Columbia takes a different route. Instead of a per-ounce excise charged to distributors, D.C. applies an 8% sales tax on soft drinks at the register, paid directly by the consumer.⁶ That rate sits above the District’s standard 6% sales tax. As in Philadelphia, D.C.’s tax covers artificially sweetened drinks alongside sugar-sweetened ones.

The Navajo Nation

The Navajo Nation has taxed sugary drinks since 2014 under the Healthy Diné Nation Act, but the structure is broader than a typical soda tax. The rate is 2% of the sale price and applies to what the law calls “minimal-to-no nutritional value food,” a category that sweeps in candy, chips, pastries, and other snack foods high in sugar, salt, or saturated fat as well as sweetened beverages.⁷ Because it taxes food as well as drinks and uses a percentage rather than a per-ounce rate, it works more like a general junk food tax than a soda-specific measure.

States That Block Local Sugar Taxes

Part of the reason sugar taxes remain rare is that four states have passed preemption laws stopping their cities from creating new ones. Arizona, California, Michigan, and Washington all did so between 2017 and 2018.

California’s AB 1838, signed in June 2018, bars any local government from imposing new taxes on groceries, a category that includes beverages, through January 1, 2031.⁸ The existing taxes in Berkeley, Albany, Oakland, and San Francisco were grandfathered in. Santa Cruz was able to pass its 2024 tax anyway because its status as a charter city gave it broader taxing authority than general-law cities.

Washington State’s Initiative 1634, approved by voters in November 2018, also blocks local governments from imposing any new tax on groceries, which the measure defines broadly to cover any food or beverage intended for human consumption other than alcohol, cannabis, and tobacco.⁹ Seattle’s tax, already in effect, was left alone. Arizona and Michigan adopted their preemption laws before any city in either state had passed a local tax, so no grandfathering was needed.

Places Where Sugar Taxes Have Been Repealed

Not every sugar tax has stuck. Cook County, Illinois, which includes Chicago, enacted a one-cent-per-ounce tax in August 2017. It lasted four months. The county board voted to repeal it in October 2017, and collection ended December 1 of that year.¹⁰

At the state level, West Virginia collected a soft drink excise tax for decades before the legislature passed Senate Bill 533 in 2022 to phase it out. Collection officially ended on July 1, 2024.¹¹ Arkansas has kept a soft drink excise tax since 1992, charging $1.26 per gallon of syrup and about 21 cents per gallon of bottled soft drinks, but that one is generally treated as a revenue measure rather than a public-health sugar tax.¹²

How the Tax Is Charged

Most U.S. sugar taxes are excise taxes charged to the distributor, not the consumer. When a distributor delivers beverages to a retailer within the taxing jurisdiction, the distributor owes the tax based on the total fluid ounces delivered.⁴ The cost still reaches consumers. Research across multiple cities found that retailers raised shelf prices by about 1.3 cents per ounce after a one-cent tax took effect, passing roughly 92% of the cost through to shoppers.

D.C. is the exception. Its tax runs as a higher sales tax rate at the register, so consumers see the charge on the receipt rather than built into the shelf price.⁶

Every active U.S. sugar tax uses a flat per-ounce rate regardless of how much sugar the drink contains. A lightly sweetened iced tea and a heavily sugared energy drink of the same size pay the same amount. No U.S. jurisdiction has adopted a tiered structure that would charge more for drinks with higher sugar content.

What’s Typically Exempt

Every jurisdiction with a sugar tax carves out certain beverages. The specifics vary, but the pattern holds: drinks with real nutritional value, or no added sweetener, are generally left alone.

100% fruit juice, because the sugars are naturally occurring rather than added.
Plain milk, flavored milk, and yogurt drinks.
Unsweetened coffee and tea, though sweetened versions are taxed.
Infant formula, meal replacements, and medical foods.
Alcoholic beverages, which carry their own separate taxes.

The sharpest split involves artificially sweetened drinks. Most jurisdictions exempt diet sodas and zero-calorie beverages on the view that the tax should target sugar specifically. Philadelphia and D.C. tax them anyway, treating the measure as a broader beverage tax rather than a sugar-only one.¹³

Where the Revenue Goes

Sugar tax revenue is typically earmarked, and the earmark often helped sell the tax to voters in the first place. Philadelphia projected roughly $91 million a year, most of it directed to publicly funded pre-kindergarten for low- and moderate-income families, with additional funding for community schools and parks and recreation improvements. That revenue commitment was widely credited with getting the tax through after two earlier attempts had failed.

Seattle’s tax brought in about $20.15 million in 2024, funding childcare assistance, food security programs, and early learning.¹⁴ Boulder puts its revenue toward health promotion, chronic disease prevention, and programs for residents with low income.³ Berkeley generates around $1.15 million a year for community nutrition and cooking programs.

1
City of Berkeley. Berkeley’s Tax Ordinance
2
Legislative Analyst’s Office. Taxation of Sugary Drinks
3
City of Boulder. Sugar Sweetened Beverage Tax
4
City of Philadelphia. Philadelphia Beverage Tax (PBT)
5
Seattle.gov. What is the Sweetened Beverage Tax?
6
DC Office of the Chief Financial Officer. Tax Rates and Revenues, Sales and Use Taxes, Alcoholic Beverage Taxes, and Tobacco Taxes
7
Office of the Navajo Tax Commission. CN-54-14 Healthy Diné Nation Act of 2014
8
California Legislative Information. AB 1838 Local Government – Taxation – Prohibition – Groceries
9
Washington State Legislature. Chapter 82.84 RCW – Local Grocery Tax Restrictions
10
Cook County Government. Statement from Cook County Board President Toni Preckwinkle on Sweetened Beverage Tax Repeal Vote
11
West Virginia Legislature. Senate Bill 533
12
Arkansas Department of Finance and Administration. Soft Drink Tax
13
City of Philadelphia. What is Subject to the PBT
14
Seattle.gov. 2024 Q4 Year-End Revenue Report