Soda Tax in New York: S2330, Past Proposals, and Stalled Progress

There is no dedicated soda tax in New York. Sugary drinks are subject to the state’s ordinary sales tax at the register, but no separate excise tax on sugar-sweetened beverages exists at the state or city level. A bill that would create one — charging distributors up to two cents per ounce and steering the revenue into community health programs — has been reintroduced in Albany every session since 2019 and, as of early 2026, remains stuck in committee without a hearing.

What New York Taxes on Sugary Drinks Right Now

Under current state tax law, most sodas, sports drinks, energy drinks, fruit drinks with less than 70 percent natural juice, and similar sweetened beverages are already subject to New York’s general sales tax when sold ready to drink.¹ Beverages with 70 percent or more natural fruit juice, plain coffee and tea, milk, and liquid diet products are generally exempt when sold unheated in standard retail packaging.²

That’s it. No penny-per-ounce, no tiered sugar levy, no earmark for health programs. What advocates have been pushing for is something categorically different from a sales tax: an excise tax paid by distributors, calibrated to sugar content, with revenue dedicated to specific uses rather than deposited into general funds.

The Bill on the Table: S2330 and A3490

Senator Gustavo Rivera has introduced a sugary drink excise tax in every legislative session since he took over the Senate version in 2021–2022. The current versions are S2330 in the Senate and A3490 in the Assembly, both filed in the 2025–2026 session.³⁴ The Assembly version is sponsored by Assembly Member Reyes, with co-sponsors Anna Kelles and John Zaccaro Jr.; S2330 has 17 co-sponsors. The effort originally started in the Assembly with A9925, carried by Assemblyman Felix Ortiz in 2019–2020.

How the Tax Would Be Calculated

The tax would apply to distributors, tiered by grams of sugar per 12 fluid ounces:³

7.5 grams or less: no tax.
More than 7.5 grams but less than 30 grams: one cent per ounce.
30 grams or more: two cents per ounce.

The levy sits on distributors, not directly on shoppers. Studies of similar taxes in other cities have found the cost is typically passed through to retail prices.

Where the Revenue Would Go

All revenue would flow into a new Community Health Equity Fund overseen jointly by the State Comptroller and the Commissioner of Taxation and Finance. Up to $500,000 would first go toward establishing a 13-member Community Advisory Board on Health Equity. The rest would be split evenly: half to fund SNAP incentives giving food-stamp recipients extra money for fruits and vegetables, and half to a Community Health Benefits Trust that would award grants to community-based organizations working on food access, school nutrition, physical activity, and parks and playgrounds in neighborhoods with the highest rates of diet-related disease.⁵³

The bill also explicitly authorizes municipalities to layer their own local excise taxes on sugary drink distributors on top of the state levy — a design choice that runs opposite to the state preemption laws the beverage industry has secured in other states.⁵

Where the Bill Stands

Neither chamber’s version has moved. S2330 was referred to the Senate Budget and Revenue Committee in January 2025, re-referred there in January 2026, and has received no hearings, markups, or votes.³ A3490 followed the same path in Assembly Ways and Means.⁵ Governor Hochul has not taken a public position on the bill.

Earlier Attempts That Failed

The current bill is the latest in a fifteen-year run of unsuccessful efforts to tax or restrict sugary drinks in New York.

Paterson’s Penny-Per-Ounce Proposal

Governor David Paterson included a one-cent-per-ounce tax on sugar-sweetened beverages in his proposed state budget in 2009 and 2010, framed as both a deficit measure and an obesity response. It never reached a vote. The American Beverage Association spent nearly $12.9 million on lobbying in New York in 2010 alone, and PepsiCo, headquartered in Westchester County, threatened to relocate out of state before ultimately staying after receiving a $4 million grant from the state’s economic development agency in 2011.⁶ Paterson withdrew the proposal.⁷

Bloomberg’s Portion Cap Rule

Mayor Michael Bloomberg took a different route. In September 2012 the New York City Board of Health adopted a rule capping sweetened beverage containers at 16 ounces in restaurants, delis, movie theaters, stadiums, and street carts, with an effective date of March 2013.⁸

It never took effect. A trial court struck the rule down in March 2013, the Appellate Division affirmed unanimously, and in June 2014 the New York Court of Appeals ended the case in a 4-2 decision.⁹¹⁰ Applying the framework from its 1987 decision in Boreali v. Axelrod, the court held that the Board of Health had made policy choices that belonged to the legislature. The ruling matters for any future tax fight: it confirmed that regulating sugary drinks in New York has to go through elected lawmakers, not administrative rulemaking.⁸

What New York Has Done Instead

With no statewide excise tax and no portion cap, the state and city have used narrower tools.

In 2020, NYC Health + Hospitals eliminated the sale of all sugary beverages with more than 25 calories per eight ounces across its public hospital system, building on earlier removals from inpatient meals in 2008 and vending machines in 2017.¹¹

A city rule known as the Sweet Truth Act took effect in October 2025. It requires chain restaurants with 15 or more locations nationwide to display a warning icon next to menu items containing more than a day’s worth of added sugars. The underlying legislation passed the City Council in 2023, and enforcement with fines up to $200 began in January 2026.¹²

At the state level, Senators Brian Kavanagh and Gustavo Rivera have introduced S2087, the High-Sugar Beverages Safety Warning Act, which would require warning labels on sealed beverage containers and vending machines for drinks containing 100 percent or more of the FDA’s recommended daily intake of added sugars. Like the excise tax bill, it has been reintroduced since the 2013–2014 session and has not moved out of committee.¹³

The Case Supporters Make

Advocates ground their case in consumption patterns and projected health effects specific to New York. A 2017 report from the NYC Department of Health found that 24 percent of adults in the city drank at least one sugary beverage daily, with the highest rates in the South Bronx, upper Manhattan, and parts of Brooklyn and Queens. Among public high school students, 40 percent reported daily consumption, including 47 percent of Black students and 42 percent of Latino students, compared with 29 percent of white students.¹⁴ Statewide, 23.7 percent of adults consume at least one sugary drink per day, with the Bronx leading at 27.7 percent.¹⁵

The CHOICES Project at Harvard modeled a New York State sugary drink tax and projected that a two-cent-per-ounce version could prevent roughly 72,400 cases of obesity over a decade, reduce diabetes incidence by 3 to 6 percent, and generate between $397 million and $1.05 billion in net healthcare savings, with annual revenue running from $587 million to over $1 billion depending on the rate.¹⁶

Evidence from seven U.S. cities that have adopted sugary drink taxes is central to the pitch. A study in JAMA Health Forum in January 2024 examined taxes in Philadelphia, Seattle, San Francisco, Oakland, and Boulder, finding retail prices of taxed beverages rose an average of 33.1 percent while purchase volumes dropped by 33 percent, with no evidence of consumers driving elsewhere for cheaper drinks.¹⁷ Philadelphia’s 1.5-cent-per-ounce tax generated $409 million between 2017 and 2022, funding free pre-kindergarten, community schools, and renovations to parks, libraries, and recreation centers.¹⁸

The Case Against

The American Beverage Association calls the taxes “unproductive,” noting that nearly 60 percent of beverages sold today contain zero sugar and that per-capita calories from beverages are at their lowest level in decades.¹⁷ The industry has spent heavily in New York specifically, including the nearly $12.9 million in 2010 lobbying and PepsiCo’s relocation threat.⁶

The regressivity concern comes from beyond the industry and is substantive. Because lower-income households spend a larger share of their income on sugary drinks, a per-ounce tax hits them proportionally harder. A systematic review of five studies concluded that such taxes are regressive in financial terms, with low-income households paying between 0.10 and 1.0 percent of annual income compared with 0.03 to 0.60 percent for high-income households.¹⁹ Senator Bernie Sanders made a version of the argument in 2016, calling Philadelphia’s tax “a regressive grocery tax that would disproportionately affect low-income and middle-class Americans.”²⁰

Supporters counter that the financial regressivity is small in absolute terms and offset by progressive health benefits, since lower-income consumers are more price-sensitive and would see the biggest drops in consumption. The CHOICES report projected that household spending on sugary drinks would fall overall because the volume decline would outweigh the price increase.¹⁶ The earmark for SNAP fruit-and-vegetable incentives and community health grants is the bill’s answer to the equity critique.

Why the Bill Keeps Stalling

The pattern is stable. A soda tax bill is introduced, picks up co-sponsors and support from public health groups and academic researchers, and sits in committee without a hearing. Industry lobbying is part of it, but the politics run wider. The regressivity argument lands with legislators representing lower-income districts, even those sympathetic to the health case. The portion cap loss in 2014 left its own legacy — a reminder that the courts will send this policy back to the legislature and that voters and lawmakers alike have proven wary of it.

S2330 tries to answer those objections through design: revenue routed to SNAP incentives and community grants rather than the general fund, and explicit authority for cities to add local taxes rather than being preempted. Whether that’s enough to move the bill out of committee is unresolved. As of mid-2026, no hearing has been scheduled.

1
New York State Department of Taxation and Finance. Listings of Taxable and Exempt Food and Beverages
2
New York Codes, Rules and Regulations. 20 CRR-NY 528.2 – Beverages and Beverage Bases
3
New York State Senate. S2330 – Imposes an Excise Tax on Beverages With High Sugar Levels
4
New York State Assembly. A3490 Summary, Actions, and Text
5
New York State Senate. A3490 – Imposes an Excise Tax on Beverages With High Sugar Levels
6
Center for Science in the Public Interest. Beverage Industry Political Spending Fact Sheet
7
American Journal of Managed Care. Will NYCs New Mayor Follow Through on Soda Limits
8
New York Court of Appeals. Matter of New York Statewide Coalition of Hispanic Chambers of Commerce v. NYC Dept. of Health
9
Justia Verdict. The Soda Ban Portion Cap Rule
10
ABC7 New York. Court Wont Reinstate New York Citys Big Soda Ban
11
NYC Health + Hospitals. NYC Health + Hospitals Eliminates All Sugary Drinks From Its Facilities System-Wide
12
NYC.gov. New Added Sugars Warning Rule Goes Into Effect
13
New York State Senate. S2087 – High-Sugar Beverages Safety Warning Act
14
NYC Department of Health. Sugary Drink Consumption Among NYC Adults and Youth
15
New York State Department of Health. Information for Action Report
16
CHOICES Project. New York State Sugary Drink Tax Report
17
NPR. Cities With Soda Taxes Saw Sales of Sugary Drinks Fall as Prices Rose
18
City & State Pennsylvania. Flat, Falling Soda Tax Revenues Have Both Positive and Negative Impact
19
PubMed Central. Sugar-Sweetened Beverage Taxes and Socio-Economic Position
20
Tax Foundation. Soda Taxes Are Regressive