LANSING (WWJ) – A tax on bottled drinking water production is being proposed for Michigan.
The Michigan Bottled Water Excise Tax Act was introduced Wednesday by Rep. Peter Lucido and referred to the House Natural Resources Committee. Under the legislation, companies bottling drinking water from Michigan sources would face a 5 cent per-gallon fee.
The bill is aimed at bottled water producers such as Nestle, which is under fire for drawing millions of gallons of groundwater in northern Michigan for bottled water without compensating the state.
“It’s not fair that these out-of-state and out-of-country corporations can swoop in, take millions of gallons of our groundwater, and sell it for a profit. They’re basically poaching our water,” Lucido, of Shelby Township, said in a statement. “Why are we giving away our resources for free?”
Lucido estimates Nestle would be on the hook for $20 million dollars in taxes should his bill pass. The company currently pays the state an annual fee (only $200 according to reports) to pump water from its wells, but pays nothing for the actual extraction of water.
“Our state and its citizens deserve some compensation when companies are making a financial killing off our water – a resource they’re getting for practically nothing,” he said.
Nestle, which draws approximately 1.1 million gallons of water a day from its four pumping locations in Michigan, calls the proposed tax “inappropriate.”
Revenue from the fee would be restricted for use on infrastructure improvements throughout Michigan.
“The funds would go directly to upgrading aging infrastructure, like the municipal sewer systems that overflow and dump sewage into Lake St. Clair,” Lucido said. “We need to preserve, protect and repair our sewer and water systems, and this will provide a fitting funding source.”