HB 2734
In CommitteeHouse
Sugar-sweetened beverages
Creating a hunger free Washington through a sugar-sweetened beverage tax and precluding a supplemental nutrition assistance program waiver.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill creates a $0.03 per fluid ounce excise tax on distributors of sugar-sweetened beverages in Washington, with all revenue dedicated to expanding food security and nutrition programs—especially for low-income families, children, and communities of color disproportionately affected by food insecurity and diet-related disease. It also blocks state efforts to ban sugary drinks from SNAP and preserves existing local taxes in cities like Seattle.
- Imposes a $0.03 per fluid ounce excise tax on distributors of sugar-sweetened beverages, effective January 1, 2028.
- Defines 'sugar-sweetened beverage' broadly to include sodas, energy drinks, sweetened teas and coffees, and fruit drinks with added sweeteners—but excludes milk, 100% juice, medical beverages, and products with fewer than 20 calories per 12-ounce serving.
- Creates the 'Hunger Free Washington Account' in the state treasury, into which all tax revenue must be deposited and spent only on approved food security and nutrition programs.
- Requires tax revenue to fund: the Supplemental Nutrition Assistance Program (SNAP), food assistance, fruit and vegetable incentives, free/reduced school meals, and farm-to-school programs.
- Bars the state from seeking a federal waiver to exclude sugar-sweetened beverages from SNAP-eligible foods, ensuring consistency with federal nutrition program goals.
- Allows cities with pre-2018 local sweetened beverage taxes (e.g., Seattle) to adjust their local laws to match the state’s definitions and rates, and provides tax credits to distributors for taxes already paid locally.
Who is affected
- Beverage distributors — Distributors (e.g., manufacturers, bottlers, wholesalers) who deliver or supply sugar-sweetened beverages in Washington for retail sale are responsible for paying the tax at the time of first distribution.
- Retailers — Retailers (e.g., grocery stores, convenience stores, restaurants) may be liable for unpaid tax if they receive taxable beverages from distributors who did not pay the tax.
- Low-income and food-insecure populations — Low-income families, children, seniors, and communities of color—especially Black, Hispanic, and Native American households—are the primary intended beneficiaries, as revenue will support food security and nutrition programs targeting these groups.
- Local governments with existing beverage taxes — Local governments with existing local sweetened beverage taxes (e.g., Seattle) gain authority to adjust their local taxes to align with the state law and receive credits for taxes already collected.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
The $150M/year dedicated revenue stream will significantly expand access to SNAP, school meals, and fruit/vegetable incentives—programs proven to reduce food insecurity, improve child development, and lower long-term healthcare costs—directly benefiting low-income families, children, and communities of color disproportionately affected by diet-related disease.
HealthcarePeopleRef: Sec. 9(1)The tax is structured to be progressive: evidence from cities with similar taxes shows net redistribution from higher- to lower-income households, because while all consumers pay more for sugary drinks, low-income households gain the most from expanded food assistance, and high-income households consume fewer sugary beverages on average.
FinancialPeopleRef: Sec. 1(1)(g)Funding for free/reduced school meals and farm-to-school programs directly supports academic performance, attendance, and long-term outcomes for students in high-poverty districts—particularly children in Black, Hispanic, and Native American households who face the highest food insecurity rates.
EducationPeopleRef: Sec. 1(1)(c), (h), (i); Sec. 9(1)(a)-(e)By preventing the state from excluding sugary drinks from SNAP eligibility, the bill avoids undermining federal nutrition program goals—while maintaining access to food assistance, the tax itself creates a financial disincentive to purchase sugary drinks, supporting public health without restricting SNAP benefits.
HealthcarePeopleRef: Sec. 1(1)(d), (e), (f); Sec. 10The bill preserves local taxing authority for cities with pre-2018 sweetened beverage taxes and allows them to align local laws with the state framework—ensuring continuity of local revenue while avoiding administrative fragmentation.
Local GovernmentPeopleRef: Sec. 7; Sec. 6(1)
Potential Concerns (4)
The $0.03/fluid ounce tax increases costs for beverage distributors and may be passed on to consumers, raising prices on sugary drinks across the board—though low-income households spend a larger share of income on such items, the tax itself is not targeted at consumption but at distribution, limiting its regressive impact compared to a sales tax.
FinancialRef: Sec. 3(3)By mandating that Hunger Free Washington Account funds be used only to *supplement* (not supplant) existing nutrition programs, the bill risks creating a false sense of added value if federal or state funding is reduced elsewhere, potentially leaving programs underfunded if the tax revenue fails to meet projections.
Public SafetyPeopleRef: Sec. 9(2)Local governments with pre-2018 sweetened beverage taxes (e.g., Seattle) receive credits for taxes paid locally, which preserves their fiscal autonomy but may reduce net local revenue if distributors shift distribution to avoid double taxation—potentially shrinking local budgets for public health or infrastructure.
Local GovernmentRef: Sec. 6(1)The bill reinforces Washington’s ban on local grocery taxes, limiting local governments’ fiscal flexibility to fund other community needs—though this protects consumers from overlapping taxes, it constrains local revenue options at a time when many municipalities face budget pressures.
Business & EmploymentLean peopleRef: Sec. 11 (amending RCW 82.84.040)
Who Is Most Affected
Low-income families, children, and communities of color—especially Black, Hispanic, and Native American households—are the primary intended beneficiaries; expanded SNAP, school meals, and fruit/vegetable incentives will directly improve food security, health outcomes, and academic performance for these groups.
Beverage distributors face a new tax liability, but the structure (tax at first distribution, credit for local taxes paid) minimizes compliance burden and double taxation; large national distributors may absorb or pass on costs more easily than small regional ones.
Retailers (grocery stores, convenience stores, restaurants) are not directly liable for the tax unless distributors fail to pay, but may experience reduced sales of sugary drinks over time as prices rise and consumption falls—potentially affecting margins on high-volume items.
Local governments with pre-2018 sweetened beverage taxes (e.g., Seattle) retain authority to adjust local laws to parity with the state, and receive credits for taxes already paid—preserving local revenue while avoiding duplication, though net local collections may decline slightly if distributors consolidate distribution channels.
State and local public health agencies benefit from increased funding for nutrition programs and potential long-term reductions in diet-related disease burden, but the bill does not create new administrative structures—existing agencies (DSHS, DOH, OSPI) will implement the programs using new funds.