25-Cent Tax Unwelcome During Tough Economic Times

Last modified on July 6, 2009 by Site Administrator

“The unemployment rate in Baltimore has nearly doubled since the start of 2008 as a result of the global economic crisis. Food and energy prices are rising. Now is not the time to add taxes and fees on family grocery bills … This proposal is out-of-touch with the needs and struggles of our citizens.”

- Stephanie Rawlings-Blake
Baltimore City Council President

The Baltimore City Council is currently considering Bill #08-0208, which would require a 25-cent surcharge for all plastic and paper bags distributed by retailers. Bags exempt from the surcharge include those used for fresh produce, nuts, poultry, meat, dairy, ice, and cooked food. The bill also requires that retailers report their revenue, the number of exempt bags distributed, and the number of bags distributed that are subject to the fee to the Director of Finance on a monthly basis. The bill provides a late fee of 10% of the total amount overdue and 1% for every month that the surcharge is not paid. Any retailer violating the requirements will be found guilty of a misdemeanor and upon conviction, is subject to a fine up to $1,000, up to six months imprisonment or both.

In a letter to the Baltimore City Council, the Department of Law stated concerns that the monthly reporting requirements placed on retailers can likely be challenged as a violation of the Commerce Clause of the United States Constitution, which provides that the City may only regulate local aspects of interstate commerce if the regulations are not unduly burdensome. The proposed reporting system would require every retailer to count every plastic bag used by ringing up purchases, bagging them, counting the number of bags used, and then adding the appropriate fee to the total before the consumer pays. To date, this clause has not been challenged because no existing legislation calls for the same rigorous reporting requirements proposed by the Baltimore City Council.

Bill #08-0208 is sponsored by council members James Kraft, Bill Henry, William Cole IV, and Mary Pat Clarke and has met contentious debate from the public, business owners, and government officials. A similar proposal banning the use of plastic bags was proposed and rejected in July 2008. While proponents of a bag fee argue that it would reduce litter in the Inner Harbor, critics argue that passing on additional costs to shoppers will sour customer relations and drive them across city lines.

City Council President Stephanie Rawlings-Blake openly announces her opposition to the proposed tax, citing the $6.4 million burden that will be placed on the city’s businesses and low-income residents in already difficult economic times. Council members supporting the bill contest that the revenue will go towards purchasing reusable bags for low-income residents, but the bill does not require it and does not disclose how the funds generated from the surcharge will be spent.


Baltimore City Council Bill 08-0208
This is the proposed legislation introduced by Henry, Cole, Kraft, and Clarke in September 2008. The bill calls for a 25 cent surcharge on every plastic bag supplied by retailers, excluding certain produce bags. The text outlines monthly reporting requirements that must be followed by retailers and the fines and penalties that will be issued for non-compliance. There is no mention of how the generated funds will be spent or how much of the surcharge will be allotted to retailers to cover administrative expenses.

Press Release: Rawlings-Blake Opposes 25-Cent Plastic Bag Fee
The president of Baltimore's City Council opposes Bill 08-0208 because, "The unemployment rate has nearly doubled since the start of 2008 as a result of the global economic crisis. Food and energy prices are rising. Now is not the time to add taxes and fees on family grocery bills." She also remarks, "This proposal is out-of-touch with the needs and struggles of our citizens."

Re: City Council Bill 08-0208 - Plastic Bags - Surcharge
A letter from the Department of Law to the Baltimore City Council that approves City Council Bill 08-0208 for form and legal sufficiency. The letter examines and provides links to cities that are proposing similar bag legislation. It also describes legal concerns of imposing a surcharge on plastic bags and highlights the unsettles area of the law on this topic.

News Articles

No Bag Tax from the Baltimore Sun, June 18, 2009
"It's laudable that the Baltimore City Council wants to encourage residents to cut down on their use of plastic and paper bags at grocery stores, but slapping a 25-cent fee on every bag - possibly the highest levy in the country - isn't the right way to go. It smacks of a tax on the poor in the middle of a recession..."

25-cent fee for most plastic, paper bags opposed from the Baltimore Sun, June 17, 2009
"Store owners and city residents united Tuesday against a proposed 25-cent surcharge on plastic and paper bags used in Baltimore, saying the plan would burden small businesses and city residents struggling through difficult economic times..."

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