Restaurateur thinks hes found a loophole in Seattle soda tax



Facing yet another hike to his costs, one restaurant owner believes he has found a loophole in the Seattle tax targeting sweetened beverages.

Curtis owns two restaurants in Seattle and one in Kirkland.

"I just literally thought about it this morning," Curtis told KIRO Radio's Dave Ross. For the high fructose corn syrup, for example, the cost for the Seattle restaurants is just under $86 a case; that has gone up with this new tax. So for the two restaurants in Seattle, we are just going to have everything they need ordered to the Kirkland location and deliver it ourselves to the Seattle ones."

"It's either that or we pass it on to the customers," he said. There's been too much of that. It's no different from transferring any other product that we have to. That's how I see it. I haven't seen anything in the law that says you can?t do it and so that's what we've got to do."

Glancing at the tax legislation, it is unclear if this interpretation of the law is accurate (Section K Delivery). The law does say that it is a violation to aid or abet any person in any attempt to evade payment of a license fee or tax. The Seattle tax targets distributors in the city, which pay up to 1.75 cents per fluid ounce. That cost will then be passed onto stores and restaurants "such as Curtis" which will then pass it on to customers. So having a distributor deliver the products outside Seattle will avoid the tax in theory.

But according to the Seattle Restaurant Alliance, "Curtis" plan to smuggle sweetened beverages into Seattle via his location just across Lake Washington still runs afoul of the tax law. A representative of the alliance tells KIRO Radio that if a person obtains a sweetened beverage outside Seattle, then brings it into the city to sell, they become a self-distributor and subject to the tax.

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