Nestle, Facing Closing Tax & Resource Loopholes in Florida, Throws Customers Under Bus

Florida’s long been a highly profitable playground for water bottlers (including Nestle Waters of North America). They’re allowed to pump water essentially for free (they pay only a small permit fee), and have enjoyed the benefits of an inexplicable sales tax exemption.

Now Florida’s Republican Governor – in the grip of a budget deficit – wants to close the sales tax loophole and enact a “severance tax” (a tax charged others when a resource is “severed” from the land for commercial use), and the bottled water industry (especially Nestle) aren’t happy.

Then again, many of Floriday’s citizens aren’t all that happy with the free ride enjoyed by water bottlers – especially those being asked to curtail water use in the drought-stricken state:

Public spigot stays open for water bottlers – Other Views – MiamiHerald.com

You probably thought there was a serious water shortage in Florida.

It’s why we’re spending billions to repair and repurify the Everglades, right? It’s why we’re not supposed to run our lawn sprinklers more than once or twice a week.

But hold on. It turns out there’s a boundless, virtually free supply of Florida water — though not for residents. The public spigot remains open day and night for Nestle, Coca-Cola, PepsiCo and 19 other corporations that bottle our water and sell it for a huge per-unit profit.

The stuff is no safer or tastier than most municipal tap water, but lots of us buy it, anyway. You know all the brands: Deer Park, Dasani, Zephyrhills, Aquafina, even Publix.

Common sense would suggest that a company with a balance sheet like Coca-Cola’s or Pepsi’s ought to pay for the water they take, the same as homeowners and small businesses do.

Nope. Every year, state water managers allow large bottling firms to siphon nearly two billion gallons from fresh springs and aquifers. The fees are laughably puny.

For example, it cost Nestle Waters of North America the grand sum of $150 for a permit to remove as much water as it pleases from the Blue Springs in Madison County. Every day, Nestle pipes about 500,000 gallons, enough to fill 102,000 plastic bottles that are then shipped to stores and supermarkets throughout the Southeast.

Even by Florida standards, the scale of this public rip-off is mind-bending.

Naturally, Nestle is leading the charge to protect its profits at the expense of a public resource, and bottlers – cornered by public opinion and a state hungry for money – seem willing to throw their customers under the bus while protecting their right to pump public water for free:

Lobbyists for the bottled water industry are offering an olive branch in the impending tax fight over their product. They’re agreeing to let lawmakers remove the exemption on bottled water and impose the sales tax. The hitch: the sales tax would be paid in lieu of the governor’s plan to impose a six cents severance tax on every gallon of water used for bottled water.

“We’re generally not opposed to the repeal of the sales tax exemption and we’re working to develop a potential compromise to generate revenue and still benefit consumers who use bottled water as their primary drinking source,” said Lane Stephens, lobbyist for Nestle Waters, the nation’s largest bottled water company with two plants in Florida. A six-cents a bottle tax would be paid by consumers at the point of sale, as it now is when consumers buy soft drinks.

The governor proposes that the Department of Environmental Regulation impose a 6-cents per gallon tax on water “severed” from the state by companies that use it to profit ‘s from state water. It would include the 5.4 million a day pumped from state aquifers and springs, as well as all the water taken from municipal waters supplies.

In other words, when the money comes out of their customer’s pockets, fine. When they’re asked to pay for a severed resource like any other corporation – no way.

The irony isn’t lost on everyone:

Big Bottled Water Hits Back, Hilariously

But wait! Not so fast, says Big Bottled Water. We shouldn’t have to pay taxes on the resources we extract for commercial purposes, like natural gas and oil companies do! That’s unfair!

And why, pray tell us, Nestle Water Co?

According to the Herald, the Southwest director of operations for Nestle said that “Bottled water ‘isn’t a luxury, it’s a choice,” he argues, “and during times of natural disaster, it’s a necessity.’

Mmmm. Good point, Nestle. According to Meriam Webster, the definition of ‘luxury’ is “something adding to pleasure or comfort but not absolutely necessary.” Yes, I’d say the millions of bottles of water lining supermarkets, bodegas, and convenience stores across the nation are absolutely necessary—especially when 90% of the nation has access to tap water that’s better and safer than the bottled stuff.

Paying money for water in a plastic bottle when you can get it free at home is the very epitome of luxury: it’s absolutely <em>un</em>necessary. And playing the natural disaster card? Are you kidding me?

How many, exactly of those 102,000 bottles filled <em>every hour</em> from that one single plant go to natural disaster relief? Somewhere between 0-1, by my best estimates. But closer to 0.

Nestle Waters of North America continually offers up disaster relief as an excuse to continue its plunder of water supplies in pursuit of profits (which head right out of the country to Switzerland), yet – as the Treehugger site points out – that’s simply a non-starter.

It’s like asking for an income tax exemption because you occasionally volunteer to help out at the Senior Center.

Stay tuned for more on Florida.

nestle, nestle waters of north america, bottled water, florida tax exemption, bottled water in florida, water severance tax