Fiji Water Will Pay Extra Imposed Tax to Remain in Business

Fiji Water

Fiji Water: Taking good water away from people who need it most.

Two days ago, Fiji Water‘s only production plant announced that it was shutting its doors, following a significant bottled water tax raise by the country’s military ruler. (There was talk of sourcing the water somewhere other than in Fiji, but then it wouldn’t really be “Fiji Water,” anymore, would it?) The announcement saddened many here in the U.S., as Fiji water is probably the most popular brand of premium bottled water on the market. I’m sure advocates of bottled water were saddened. Workers of the plant wept openly at their job loss. But those of us who maintain that bottled water is an unnecessary and expensive commodity that’s helping to destroy our planet were perhaps more saddened by today’s news: The Fiji plant will reopen tomorrow.  They have decided that the tax (15 cents per liter – up from only one-third of a cent per liter) is payable. The Fijian government’s total annual tax-take is expected to raise from F$500,000 to F$22.6 million.

But why don’t we consumer-obsessed Americans take our eyes off of ourselves for just one second to think about why the Fiji Water company is willing to dish out such a ridiculous amount of money to remain in production?

It’s now well-known that the success of bottled water in our nation is largely due to clever marketing tactics, most of which, sadly, we are gullible enough to fall for. Fiji is the most popular premium bottled water brand because it is well-advertised. Now, I know most of you Fiji lovers would say that it tastes different. But that idea just takes me back to a time when I was over at a friend’s house, drinking cold water which he had poured from the tap into a wine glass; I looked up at this friend, after a few sips, and said, “mmm… this water is really good! Is it Fiji?!?” And that, folks, was the day I stopped buying bottled Fiji water. I realized, at that point, that I had been tricked into believing that this Fiji-sourced artesian water was really better than what I could get at home for the price I already pay when I receive my monthly water bill.

The exotic factor is Fiji Water’s highest selling point. After all, who wouldn’t want to drink water that is bottled from an underground artesian aquifer in Fiji and never touches 21st century polluted United States industrial air until a consumer unscrews the cap? Fiji water is willing to remain in production, regardless of the tax, because they have done the math. They know that consumers will pay for it, and they know that they will still make a significant profit. Staying open, for them, is better than shutting down. It was a smart business decision.

But I can’t help but feel sorry for the people in Fiji, as well as those in other developing nations. We have access to clean water straight from the tap, along with filters that purify it even further by reducing the presence of chemical disinfectants; yet we choose to drink bottled water, simply because it comes from an underground aquifer in an exotic country, and we are gullible enough to believe that it really tastes that much better and is worth the price of $3-4 per liter (plus the extra $0.15 the company will probably now add to the cost to cover the tax). Moreover, we haven’t given a single thought to the fact that those in Fiji, not to mention those in Haiti, Indonesia, Africa and other developing nations, have to hike miles a day just to get access to dirty water that will probably either kill them or make them unbearably sick. Nor have we given thought to how much water and oil are wasted in the production, transport and disposal of this convenient luxury – a luxury that many others don’t have.

Now you may be thinking that bottled water has often been the saving grace for those in underdeveloped countries. But, giving them bottled water is like putting a band-aid on cancer. There are better, more permanent solutions, like helping these countries build a stable clean water infrastructure and teaching them how to manage it long-term.

The message is simple: think twice before you buy that next bottle of water, as it may only further contribute to the suffering of those less fortunate.

Soda Tax or Bottled Water Tax?

Obama’s health care plan is expected to cost more than $1 trillion. The most likely source of funding: taxes.  The Senate Finance Committee recently proposed a three-cent tax on sugary drinks including sodas, energy drinks and sports drinks. Diet sodas would be exempt.  Not only would this proposal aid in funding the enormous health care bill; it would also, according to legislators, reduce consumption and therefore decrease obesity.

However, some argue that a tax would not reduce consumption, and that education – not higher taxes – is what is needed to encourage others to live a healthier lifestyle.  The debate has made it difficult to pass a soda tax, as New York Governor David Paterson discovered when his proposal for a statewide 18 percent tax on soda failed. He recently revived the effort with the amendment that taxes on bottled water and diet soda would be removed if the soda tax passed. However, even with the removal of a diet soda and bottled water tax, some New York residents are still opposed to the idea as a soda tax would only pay for a tiny portion of the entire health care plan. Moreover, Americans can be picky and would likely be unwilling to make the switch from regular to diet soda or even bottled water, if they don’t already drink it.  And recent news has revealed that bottled water is not necessarily healthier – for people or the environment.

According to a recent study, a small tax on soda would not likely reduce consumption or prevent childhood obesity, but a larger tax probably would.  In a recent post on the bottled water tax, we argued that people who purchase bottled water probably don’t care too much about the cost, since they can get the same thing from their faucet at home for a lot less but still choose not to.  Soda doesn’t run from the faucet, however, so perhaps cost matters more in this case.   What do you think?  Would you change your drinking habits to save money?

Bottled Water Tax — Is Bottled Water a Sin?

This Tax Day, as many Americans are scrambling to file their income taxes, legislators around the country are considering a bottled water tax.

Washington state’s legislature recently approved a revenue package that included an increased bottled water tax, as well as a tax on candy, sodas and mass-produced beers. The bottled water tax would expire in 2013, unless voters in November approve a recently-passed bonds measure. In this case, the bottled water tax would become permanent.  This tax would fund improvements to public school buildings, and also create 30,000 construction jobs.

Countless other legislators, in the U.S. and Canada, have also debated a tax on bottled water. Why tax bottled water? What does bottled water have in common with the other taxed products in the revenue package?  They are all discretionary purchases.

Many other cities have in the past applied a sin tax on bottled water (Chicago was the first to do this in December of 2007). Alcohol and cigarettes are the most common products to fall under sin tax, and yet bottled water does not contribute to any potential health risks in an individual. It’s probably more appropriate to label a bottled water tax as an Ecotax, which Wikipedia defines as a tax meant “to promote ecologically sustainable activities via economic incentives.”

Realistically, adding 5 cents or so to the purchase price of every bottle of water probably wouldn’t dissuade most people from buying bottled water — I think most consumers of the bottled water probably don’t care too much about the price, since they can have the equivalent or an even better water at home for a fraction of the cost.

The question, then, is would a bottled water tax be ethical? Is it acceptable to tax bottled water and use the money to fund education and other worthwhile initiatives?

What do you guys think?