News & Information
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Food Fight
Detroit's mayor wants to be the first in the nation to tax fast food
By Patrick Crowley, Newsweek
May 18 - The mayor of Fat City wants to put America on a diet. Detroit Mayor Kwame Kilpatrick is proposing a two percent tax on fast food to help slim down his city’s bloated budget. The first fast-food tax in the nation would generate $17 million annually for Detroit, which would take a nice bite out of its $300 million deficit. But Kilpatrick’s “fat tax,” as opponents call it, is giving Motown a bad case of indigestion. After decades of decline, fast-food joints are among the few remaining thriving businesses in the gritty city. Detroit is, after all, the urban area that Men’s Fitness magazine last year named America’s fattest. “This doesn’t have a chance of passage,” says Maryann Mahaffey, president of Detroit City Council, which must approve the mayor’s idea before it is served up to voters. “It hits hardest at the people of the most limited income.”
Kilpatrick acknowledges his proposal has caused a political food fight. But he’s pleased it is generating buzz nationwide. And even if Detroit voters stick a fork in it, Kilpatrick believes his idea has set the table for other cities. “I hope it sweeps the nation,” he told NEWSWEEK. “Mayors in cities all over America are trying to find out how to survive in this economy. Even if we don’t succeed, other mayors will be looking at this.”
The tax would add an extra two cents per dollar on fast food purchases, above and beyond Michigan's six-cent sales tax. The mayor defines fast food as any food you pay for before you eat or drink it. In order to institute the tax, it must first be approved by the Detroit City Council and then put up for a vote by Detroit city residents—an even longer shot. Other cities, including New York, have proposed taxes on snacks and junk food. But Kilpartick's proposal is the first tax to target fast food outlets, according to the National Restaurant Association.
Needless to say, the fast-food industry is unenthusiastic about the idea. “This will be very unpopular with the public and very problematic for the industry,” said Andy Deloney of the Michigan Restaurant Association, which is working overtime to lobby against the measure that would supersize taxes on Detroit fast-food establishments from six percent to eight percent.
Kilpatrick argues that adding a few pennies to the cost of a Happy Meal, boosting it from $2.99 to $3.05, won’t curb Detroit’s appetite for drive-through dining. But cutting back on Big Macs might not be such a bad idea for Detroit. The mayor, who admits a weakness for McDonald’s fries and Wendy’s Biggie Meals, put the city on a diet after Men’s Fitness spotlighted Detroit’s bulging rustbelt. He instituted a city-wide shape up campaign known as "Movement for Life" to encourage his citizens to eat better and exercise. “I’ve lost 25 pounds myself,” says the strapping former collegiate football player (whose actual weight remains classified). “I lead by example.” The slim fast campaign is already paying off. In the latest rankings, Detroit dropped to the nation’s third fattest city. But it appears the belt tightening has only just begun.
Founded in 1921, the MRA represents more than 4,500 Michigan foodservice establishments. The foodservice industry plays an integral role in Michigan's economy, employing more than 430,000 people and creating $11.3 billion in annual sales.
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