The Pennsylvania Supreme Court has agreed to hear argument on whether the nation's first sweetened-beverage tax stands up to legal scrutiny.

Philadelphia Mayor Jim Kenney's most headline-grabbing legislative effort, colloquially known as the soda tax, will be examined by the state's justices to determine whether it violates Pennsylvania's Sterling Act, which prohibits Philadelphia from imposing a tax on a transaction or subject that the state already taxes, according to the court's order issued Tuesday.

The tax was upheld by the Commonwealth Court in June.

That court rejected the arguments of several retailers and beverage distributors, as well as the American Beverage Association, that the tax wasn't simply a levy on sweetened drinks, but instead a “power grab” by the city that could undermine businesses and overlapped with the already existing state sales tax.

Both sides' arguments in the case centered on the point at which drinks would be taxed—with distributors saying it's a sales tax and attorneys for the city government insisting it's paid directly by distributors, not at the cash register.

In upholding a Philadelphia judge's decision that the 1.5 cent-per-ounce tax was legal, Commonwealth Court Judge Michael H. Wojcik wrote in the en banc court's majority opinion that the beverage tax was not a sales tax and didn't violate the Sterling Act.

In a statement Tuesday, Philadelphia City Solicitor Sozi Pedro Tulante said the court's decision to take up the case was not surprising.

“Given the enormous public attention paid to this case—in Philadelphia, the commonwealth, and across the country—we are not surprised by the Supreme Court's decision to hear the appeal,” Tulante said.

“Our confidence in the city's authority to impose the tax has not wavered,” Tulante continued, “and we welcome the justices' thorough review of the Commonwealth Court's decision that confirmed the legality of the tax. Ultimately, we look forward to the day when the city can begin full implementation of the essential programs funded by the tax—expanded pre-K, Community Schools and Rebuild—to the benefit of tens of thousands of Philadelphia children and families.”

Shanin Specter of Kline & Specter represents the American Beverage Association.

“We are heartened by the Pennsylvania Supreme Court's decision to determine the legality of the Philadelphia beverage tax,” Specter said Tuesday. “While the city of Philadelphia has opposed Supreme Court review, it is evident that the tax poses significant legal issues. The court is right that review is warranted. All parties to this case—as well as local governments, businesses, and consumers across the commonwealth—will benefit from the court's assessment of state versus local authority in taxation.”

He added, “The city's statement is misleading as the mayor has agreed to keep pre-K even if the tax is overturned.”