The D.C. Bag Tax
Have you noticed the D.C. bag tax every time you purchase a drink or grab a bite to eat?
As of January 1, 2010, consumers at grocery stores and other food and alcohol retailers in Washington, D.C. must pay a new five cent tax on the use of plastic and paper bags. The tax, mandated by D.C. Council legislation, is the only active bag tax that exists in the United States today.
The primary purpose of the tax is environmental, with 80% of the tax going to a fund dedicated to cleaning up the Anacostia River. In addition, lawmakers hope that the tax will reduce paper and plastic litter, which accounts for 21% of the trash in the Anacostia River and is often the cause of blocked street drains. Store owners, who are responsible for collecting the tax, may keep one cent for every bag distributed. Retailers that provide incentives to their customers to bring reusable bags can retain an extra cent.
Lawmakers estimate that the tax will generate $3.6 million in revenue this year, an amount that will likely decline in future years as a growing number of consumers will begin using reusable bags. Nonetheless, some taxpayers remain displeased and skeptical, pointing to the failure of a similar tax program in San Francisco where the government proposed 17 cent tax for plastic bags. Critics argue now is a bad time to impose a bag fee when every penny counts.
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March 2nd, 2010 at 12:20 pm
I love the bag tax because of the conversations it has created, and the changes in consumer behavior that are happening over time. It’s a win-win-win situation. If a consumer wants a bag, the money goes to a good cause. If they don’t, a bag is saved…both for the store owner and the environment. As Malcolm Gladwell chronicled in The Tipping Point, small changes can reap big rewards. Will less litter lead to less crime, more volunteerism, more tourists, more…?
I wrote more about this from a consumer behavior perspective here: http://bit.ly/b2Ma2Q. I’d love to know your thoughts.