Taxing Sin

verfasst von: Assoc. Prof. Michael Thom

Verlag: Springer International Publishing

Enthalten in: Springer Professional "Wirtschaft+Technik" , Springer Professional "Wirtschaft"

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Über dieses Buch

Conventional wisdom dictates that those goods which are said to cause harm or impose costs on society deserve a special tax. For centuries, governments have levied these "sin taxes" on alcohol and tobacco, but the list of taxable sins has now grown to include soda and marijuana, with calls to impose further taxes on plastic bags, meat, and even robots and carbon. Contrary to what experts and policymakers tell us, many of these alleged sins impose very little, if any, cost on society, and the harms that do exist can be minimized without resorting to tax. What follows in this book is a discussion of four case studies—on tobacco, marijuana, alcohol and soda—which make the case against the conventional wisdom in taxing these "sins", before concluding that when it comes to taxing sin, it is time for governments to forgive—and forget.

Inhaltsverzeichnis

Frontmatter

Chapter 1. Tax Your Sins, Experts Say

Abstract

This chapter explains how sin taxes became a near-permanent strategy for governments to alter individual choice. It describes how sin taxes evolved from a politically- or religiously-motivated policy to the present-day conventional wisdom, which holds that sin taxes serve as economic penance for externality-generating choices and as a correction for cognitive biases. It illustrates how the conventional wisdom traces to the progressive era and its belief in the power of experts to diagnose and cure societal ills, especially those involving public health. The chapter contrasts that vision against criticism that paternalism overvalues experts’ abilities and that, despite its success in politics, paternalism tends to fail in practice.

Michael Thom

Chapter 2. Taxing Soda

Abstract

Experts argue that soda should be taxed because it is the leading cause of obesity and a host of other problems that create unnecessary healthcare costs. Although a considerable body of research supports that argument, a just-as-considerable body of research says the opposite. Several studies reveal no direct path from soda to obesity. Research is also clear that soda taxes do not reduce consumption by much and may actually lead to higher sugar intake. That leaves little reason to continue taxing soda, but soda paternalism is likely to remain popular. That’s thanks to tireless support from special interest groups—some of whom receive funding from soda tax revenue—as well an army of experts and public health organizations.

Michael Thom

Chapter 3. Taxing Alcohol

Abstract

Alcohol is said to impose harms, including healthcare costs and impaired driving, that warrant an alcoholic beverage tax. However, research shows that light and moderate alcohol consumption is beneficial to health. Furthermore, the burden tied to heavy drinking are exaggerated and, when all costs and benefits are considered, may not exist. Research also suggests that alcohol taxes are self-defeating; those who are likely to drink less because of higher prices are the same light and moderate drinkers whose health improves after they drink. Heavy drinkers, by contrast, are not that responsive to higher prices. But policymakers are not likely to repeal alcohol taxes. Too many experts testify to their necessity and too many special interest groups agree, all while receiving government grants.

Michael Thom

Chapter 4. Taxing Tobacco

Abstract

Smoking—and increasingly, vaping—is accused of imposing unnecessary healthcare costs on society that justify a tobacco tax. But tobacco’s societal impact is more complicated than what the conventional wisdom dictates. Many of the health risks from tobacco use are overstated. While they have undeniably shorter life expectancies, tobacco users save governments money—a lot of it. Research is also clear that tobacco taxes have little to no effect on smoking. But thanks to experts and interest groups, tobacco taxes aren’t likely going away. Too many government programs cannot afford fewer smokers, nor can experts and special interest groups funded with grants from tobacco tax revenue.

Michael Thom

Chapter 5. Taxing Marijuana

Abstract

Some experts want cannabis, especially marijuana, prohibited while others want it legalized along with a marijuana tax to pay for its ostensible harms. Although they cite alarming studies that tell of marijuana’s negative effects—that it is as a gateway to harmful drugs, mental illness, and crime—innumerable studies question whether those harms occur. They show instead that marijuana is mostly harmless, and that it is an effective treatment for dozens of medical conditions. That leaves no case for taxing it, but those who believe in the necessity of expanding government revenue are not likely to let go of what could be a lucrative moneymaker.

Michael Thom

Chapter 6. Taxing Twenty-First Century Sins

Abstract

Paternalists have recently turned their attention toward meat, plastic bags, automation, and carbon. Each one allegedly creates tax-justifying externalities: meat harms the environment and health; plastic bags have a negative environmental impact; automation—whether through artificial intelligence or robots—displaces workers; carbon feeds climate change. But time and time again, experts and policymakers appeal to questionable social science to make a case for a tax on these products. For each one, the weight of all the evidence—not just what experts highlight—suggests that no tax is warranted.

Michael Thom

Chapter 7. Conclusion: Don’t Tax Sin, Forgive It

Abstract

This chapter summarizes the evidence for sin taxes and concludes that it is, at best, weak. Far too often, experts and other paternalists make the case for taxing things like soda, alcohol, tobacco, marijuana, meat, plastic bags, and more on the basis of exaggerated claims and weak social science. Instead, it appears that paternalism’s real goal is to raise government revenue and maintain a certain level of influence over individual choices. The objective is to expand progressivism, not—or not only—to improve public health.

Michael Thom

Backmatter

Titel: Taxing Sin
verfasst von: Assoc. Prof. Michael Thom
Verlag: Springer International Publishing
Electronic ISBN: 978-3-030-49176-5
Print ISBN: 978-3-030-49175-8
DOI: https://doi.org/10.1007/978-3-030-49176-5