Agenda Item 6
Faden, Senior Legislative Attorney
Bill 8-11, Taxation - Excise Tax - Disposable Carryout Bags
recommendation (2-1, Councilmember Floreen dissenting): enact with minor amendments.
Bill 8-11, Taxation - Excise Tax - Disposable Carryout Bags, sponsored by the Council
President at the request of the County Executive, was introduced on March 15, 2011. At
introduction, Councilmembers Rice and EIrich asked to be listed as co-sponsors. A public
hearing was held on March 31. See selected testimony, ©22-25, 28-48. A Transportation,
Infrastructure, Energy and Environment Committee worksession was held on April 4, at which
the Committee recommended (2-1, Councilmember Floreen dissenting) that the Bill be enacted
with several clarifying amendments.
Bill 8-11 would impose an excise tax on certain carryout bags provided to customers at
certain retail establishments, and require those retail establishments to collect the carryout bag
tax and remit the tax to the County. The consumer would pay the tax to the retailer, who would
remit it periodically to the County Finance Department. The tax would take effect on January 1,
2012. This Bill is based on part of a similar District of Columbia law (see ©13-20) which was
enacted in 2009.
Under state law codified as County Code §52-17, the County has broad
excise taxing authority as long as the proposed tax is not a sales or property tax i.e., if the tax is
not based on the amount of the transaction or the value of the item. As a flat tax on the provision
of each bag irrespective of its cost or value, this tax qualifies as an excise tax.
1) Should the County tax carryout bags? Would an alternative approach achieve
the same environmental goals?
The Executive proposed this tax to achieve 2 different but related goals: raise some
revenue, and create an incentive for consumers and retailers to use fewer disposable bags. The