There's a storm a-brewing in Seattle, and it's all about espresso.
Voters in the coffee-lovin' city head to the polls next Tuesday to decide the fate of Initiative 77, which, if approved, will tack a dime onto the price of every espresso drink sold within the city at businesses with over $50,000 in annual sales. Your everyday drip stuff won't be taxed, however, since lawmakers have determined that only highfalutin drinks like cappuccinos are "luxuries."
The proposal first surfaced a little over a year ago, and was controversial from the beginning. Revenues generated from the new taxes would go to support early childhood education programs. No one wants to sound like a meanie speaking out against kids and education, but the choice to go after something so central to Seattle's self-image as coffee has puzzled many.
To characterize certain coffee beverages as "luxuries" is to necessarily draw flawed class distinctions. After all, it's not just rich folks plopping down moolah to sip on some caffeinated latte love. Bentleys? Full-length chinchilla fur coats? First-class plane tickets? Now, those are luxuries.
Starbucks (NASDAQ:SBUX), of course, is against the measure, but so are scads of other local coffee outfits and their suppliers. To make their opinions clear, a group of small business owners and their supporters held a mock Boston Tea Party yesterday, complete with chants of "Double tall! Hold the tax!" and period-style costumes. Rabble-rousers tossed burlap sacks into Green Lake, though the bags were thoughtfully filled only with balloons, so they'd float and could be removed from the lake post-protest.
In the end, it's in the hands of Seattle's citizens. When they cast their votes next week, will they willfully impose extra taxes on themselves and their coffee-swilling neighbors? Or will they decide that their lattes have been unfairly targeted as luxuries? We're simply buzzing with anticipation here.
LouAnn Lofton owns shares of Starbucks.
