Who doesn’t want to eat healthier, have an in house yoga studio, and get rid of every pill in the medicine cabinet? While those ambitious goals may have been part of my 2014 New Year’s resolutions, the fact is that I had a Cherry Pepsi with lunch, I’m munching on a bag of red licorice as I write this, I haven’t exercised since high school, and I pop pills like Tic-Tacs for my many physical woes (which could probably be helped by more exercise, but let’s not go there). No, this isn’t a confessional or intro to a support group meeting. I’m just mulling over new tax laws and how they will affect what consumers eat and drink.

Way back in 2003 McDonald’s was in a court battle with a family who claimed that the fast food franchise failed to mention what ingredients were in their food. According to CNN Money, “In August, a suit filed by the parents of two girls claimed that McDonald’s and two of its restaurants in the Bronx failed to disclose clearly and conspicuously the ingredients and effects of its food, much of which is high in fat, salt, sugar and cholesterol.” Reporter Jonathan Wald adds, “The plaintiffs argued that McDonald’s should therefore be held accountable for the girls’ obesity, heart disease, diabetes, high blood pressure, and elevated cholesterol.”

While that lawsuit got thrown out of court because the judge deemed it frivolous, the battle over poor nutrition still wages on. In this past November election, just weeks ago, several states had food and beverage related issues on the ballots. Berkeley, CA agreed to have a penny tax imposed per ounce of soda but San Francisco voted that same proposition down. Hawaiian voters in Maui County had a close election and approved a temporary prohibition on using genetically modified seeds to grow crops for both commercial use and simply testing purposes. Voters in Colorado overwhelmingly defeated a proposal to label foods containing ingredients derived from such crops. Oregon also joined the mix but voted down the potential law to require food manufacturers to label their products that contain genetically modified ingredients sold in the state.

How will these new taxes affect small businesses?

These new taxes will no doubt have a ripple effect on small businesses that sell food or beverages. Some reports say that the average can of Coke (without adding in advertising costs, etc.) costs only 19 cents. However, it costs 60 cents for a can, $1 for a bottle, or $2.50 at a restaurant. That is a great profit for both the beverage company and the distributor. Will 20 cents really influence the buyer’s decision whether or not to drink the beverage? How about at a restaurant; will servers be required to keep track of every refill so that the appropriate amount could be added to the bill? Only time will tell how much these changes will impact the small business owner’s bottom line.

Now, let’s delve into the topic of genetically altered food. According to GrowingNebraska.com, “Retail food-at-home prices in the second quarter of 2014 were 2.3 percent higher than a year ago, as most at-home food categories increased in price. Retail beef and veal prices were up 10.8 percent as the supply of beef is strained by historically low herd sizes. Over the same time period, pork prices increased 11.2 percent, partially the result of the Porcine Epidemic Diarrhea virus, which has reduced litter sizes and increased piglet mortality. Egg prices are also up, in part due to increasing exports and a strong domestic demand for eggs and egg products. The increases in beef and veal, pork, and egg prices are the largest year-over-year increases since the fourth quarter of 2011.”

Now I would much rather eat organic, locally raised food but my finances, like many, are already stretched. For small business owners, if you add in the possible minimum wage increase, potential employee health care plans, and now increased food and beverage costs, the new financial strain can be quite a burden to bear.

What can a small business owner do?

The best bet for a small business owner is to find an experienced business lawyer and accountant to create a new business plan for the individual company and to crunch the numbers to adjust pricing with an improved, realistic budget. When you have the right professionals on your side, the investment can definitely pay for itself as a better strategy for success is implemented.

So, with these new laws, is it better to be poor and healthy or have a few coins to rub together and be gluttonous? Sorry, I can’t answer that. I’m busy drinking my Pepsi.

About the author

Christina Morales

Christina helps provide useful business and legal tips on UpCounsel for our customers and visitors. Having over a decade of writing experience in a variety of industries, she has also been very close to the legal space from a young age with family members who continue to practice business and tax law.

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