From AFP:
A debate over water is boiling over in the United States and elsewhere amid growing environmental concerns about bottled water and questions about safety of tap water.
The US Conference of Mayors in June passed a resolution calling for a phasing out of bottled water by municipalities and promotion of the importance of public water supplies.While largely symbolic, the vote highlighted a growing movement opposing regular use of bottled water because of its plastic waste and energy costs to transport drinking supplies.
...
The Pacific Institute, a California think thank on sustainability issues, contends that producing bottles for US water consumption required the equivalent of more than 17 million barrels of oil in 2006, not including the energy for transportation.
The group says bottling water for Americans produces more than 2.5 million tons of carbon dioxide and consumes three liters of water for each liter of bottled water produced.
I assume that public (tap) water supplies are almost exclusively of domestic origin (probably a safe assumption, although I suppose there could be some exceptions in border areas). By contrast, bottled water is sometimes imported (I'm not sure what the percentages are, and they probably vary by country). So, would government action to promote public water over bottled water violate GATT Article III:4, by favoring domestic products over imported ones? A key question: Is bottled water "like" tap water? It is probably "substitutable" to some extent, but "like" may be a harder question.
This is all putting aside the Article XX issues, of course.