Again though I don't know why people assume these sin taxes would be a strain on a low-income family. Have you ever thought that people not buying these snack foods because of the taxes would save them money?
To expand upon what Strop pointed out, costs aren't just monetary. Costs can be in time, skill or any number of things, which means that for a low-income family with providers working multiple jobs to stay afloat (as they so often need to), costs are much higher for 'healthier' options. Although the
price as related to the quantity of food might be cheaper for 'healthier' options and ingredients, it would be more expensive in
costs. Both because of the time it would take to prepare the food (which as I mentioned before can be extraordinarily costly to low-income families), and because the amount of the ingredients they would actually use are much less than the amount they're paying for.
Let me give you an example:
A low-income family is presented with options of a fast-food dinner or a healthy meal in the form of home-made soup. They decide to choose the 'healthier' option and make their own vegetable soup. So they cheaply buy, in bulk, some beans, carrots, onions, garlic, tomatoes, potatoes, and peppers, as well as some parsley and olive oil, and they make enough soup to last a week. The problem is nobody wants to eat the same vegetable soup for a week, so whatever they don't eat is an additional cost, without a return in any benefit. Of course, they could buy smaller amounts of ingredients, but that would also entail more frequent shopping, which is incredibly costly in time.
You also brought up buying 'healthier' options like yogurt or bread and margarine, but then the government would have to get into the messy business of defining what's healthy and what's not. Margarine, cheese, yogurt, and butter all
can have incredibly high caloric content and other unhealthy effects, so would they be considered 'junk-food' and taxed as such? Or would they be separated by healthy options an unhealthy options of each product, which would greatly interfere with the economics of the free-market?
Therefore if the tax is set at 20% in Oregon, and it is 20% in Washington. There wouldn't be any black marketing, because the would be black marketers wouldn't make any profit if they bought chips at $6 in Washington but sold at $5 in a bordering state.
I believe you meant to say bought at $6 and sold at $6, right?
And while the idea of black-market chips is rather amusing, I was thinking more in terms of cigarettes and alcohol. So, essentially, the tax would have to be a federal tax
on top of the state taxes that already exist, which are pretty high. This would of course greatly encourage the growth of black-markets for these goods in one way or another. If the tax is federal, goods would be smuggled from Canada. If the tax existed in Canada, the goods would come from Mexico. If the tax encompassed the entire NAFTA region, the goods would come from Central America or bootleggers. Where there is profit to be found, someone will
always find it.
That is a good point, a very good one actually, however to stop these higher rises in shoplifting cases due to the aforementioned tax law I would suggest that shop lifters be made an example of by pursuing them to the full (but reasonable) extent of the law for their crimes, as a deterrent to other shoplifters.
They already are prosecuted to the full extent of the law. It doesn't seem to help much, especially when the profits can be
extraordinary. But whether shoplifting occurs for profit or for oneself, the threat of prosecution doesn't seem to be a huge deterrent.
I'm not sure if you actually intended to, but this sums up both the rationale and the practical challenges in the notion of Carbon Offsetting. Australia has, in fact, adopted Carbon Tax... a very controversial move and unusually ballsy of the Labor Government, given they introduced it at a time their polls were already flagging, and their opponents the Liberal/National coalition were doing quite a job of scaring people with another argument mentioned on this page, that broad taxes like these end up hurting end-consumers and small businesses as costs to large businesses and primary suppliers are merely passed on. Strangely enough the whole thing blew over when the Carbon Tax was put into practice and the public realised that paradoxically, as sound as our concerns were, rises in our energy bills and cost of consumables were not at all attributable to the Carbon Tax, but instead other nonsensical practices perpetrated by our energy suppliers.
I did intend to, as carbon offsets are something I've been very interested in (I study economics, so I tend to look for solutions related to my field). I didn't know that about Australia though. That's really, really cool. It's also, unfortunately, a seemingly universal condition where something will be opposed until it's passed and people are shown that it's, in fact,
good.
A country like the US, however, which has a culture that seems to be averse to "one for all and all for one" and seems to prefer "look out for number one, and that number one is you and you alone", I can see why such an approach would be unpopular.
I blame a combination of old-time values and free-market economics for that. We've been shown for quite a while now that when we look out for our individual selves economically, that tends to result in economic improvement for everyone (in a free-market). It seems to have negatively affected our rationales for most everything else.
Strop, I do apologize for the large amount text. I really do. It's just that this is all so
interesting. I can't help myself.
