Tuesday, June 2, 2009

On Taxing Sin

A point from Splice Today, (via Reason Hit-and-Run), on the proposition to impose a national tax on "sugary" beverages:
Why stop at soda? How about a tax on every calorie-laden coffee drink served at Starbucks and its competitors? After all, a vanilla bean frappuccino with whipped cream is more than 500 calories, a beverage that health researcher Mike Adams calls “dessert in a cup.”

...I’m not attempting to be facetious here, but rather point out the gross inequities when new sin taxes are considered: it’s aimed at the déclassé products, such as soda and fast-food burgers, and protects—for the sake of general class description—the “Whole Foods” crowd from their gluttony.

...why not slap a heavy tax on country club memberships, restaurant meals that total more than $150 for a table of two, and increase the alcohol sin tax on pricey wines and premium brands of spirits?
Of course no politician could suggest something like that, because they'll hear no end of it at their next cocktail party. But taxing soda and fast food? The "Whole Foods" crowd can get behind that proposition, because they don't consume much of those things anyway.

AFTERTHOUGHT: And of course, many jurisdictions could save considerable amounts of money if they cut public funding for symphonies, opera companies, and the theater, which amount to a massive subsidy for the personal entertainments of the very wealthy. This is, of course, less likely than taxing Starbucks.


Elephantschild said...

What about high-falutin' sugary drinks like Jones soda and SoBe and stuff like that?

Really, they should just be honest and call it a "plebeian tastes" tax.

Shane said...

I'm not too concerned about the regressive nature about a potential sweetener tax. Diabetes, Obesity, and heart disease disproportionately affect the poorer socioeconomic classes. I generally feel the same way about cigarette taxes. And I think alcohol taxes should probably be based on direct alcohol, instead of taxing beer, wine and liquor at different rates. (Full disclosure - I love beer and beer is currently taxed at the highest rate per ounce of alcohol).

I'm far more concerned with the whole fact that these drinks are only as cheap as they are because of the corn subsidies.

Why subsidize an input and then tax the output? It seems like it's just giving money away to the producers of the input. Oh wait, that's right - Iowa gets to go first in the presidential primaries.

My country has such a stupid political system.