AAF Government Report

May 23, 2014

Clark Rector Jr., Executive Vice President – Government Affairs

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Senator Introduces Bill Targeted Food Ad Deductibility

Senator Richard Blumenthal, D-Conn., has introduced legislation, the Stop Subsidizing Childhood Obesity Act, which would deny the federal tax deduction for advertising to children under age 14 of foods of “poor nutritional quality.”

Under the provision of the bill:

  • Any advertisement or marketing of “poor nutritional quality” foods to children would no longer be deductible as an ordinary and necessary business expense. This tax denial would also extend to brands that are primarily associated with “poor nutritional quality” foods.
  • Brands are defined as “a corporate or product name, a business image, or a mark, regardless of whether it may legally qualify as a trademark.”
  • Marketing would include traditional media advertising; the use of characters on package labeling; advertising in movie previews, apps, or video games; on-site advertising displays at retail sites or events; character licensing and toy cross-promotions; celebrity and athlete endorsements; and advertising within schools.
  • The Institute of Medicine (IOM) must conduct a study and report within 60 days of enactment establishing procedures for identifying foods and brands of poor nutritional quality.

As of this writing, no action has been scheduled on the measure.

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