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I wonder if there is some political philosophy to describe my thoughts on this - but I never understood why government just didn't set up taxes on things it did

by morrow 15y ago

I wonder if there is some political philosophy to describe my thoughts on this - but I never understood why government just didn't set up taxes on things it didn't like, and directly allocate the revenues from those taxes to the opposite side of whatever stance it took (versus going towards general expenses). For example with this, tax the happy meal and other fatty kids foods, allocate revenues earned from that tax directly to childhood obesity prevention campaigns. McDonald's still makes money, kids still can get happy meals, and childhood obesity is reduced through funding effective programs.

kalmi10 15y ago
In Hungary they are taxing too fatty, too sweet and too salty foods. Oh.. and drinks with high coffeine content. http://www.chew.hu/welcome_to_the_maybe_healthy_a.html http://www.chew.hu/welcome_to_the_maybe_healthy_a.html Some foods' salty version costing twice as much as the non-salty version (for example peanuts). I can't say we like it...
protomyth 15y ago
They tried this with the tobacco taxes / settlements and just decided to spend it any way they wanted.
Codayus 15y ago
You're half right. If you think about it a bit, you'll work out that taxing "bad things" is a great idea, and that the proper tax rate is the net externality of the activity. We're not trying to stop the activity outright (if we were, we'd ban it); we just want to get rid of the "excess" activity. Since the excess is caused by a negative externality (ie, people aren't paying the full costs), if you set the tax to be equal to the externalities, everything comes back into balance. Spending the collected tax money on something related to what you're taxing (ie, cigarette taxes on curing cancer, or whatever) is entirely uneccesary. (Indeed, given the fungability of tax dollars, the concept doesn't even make sense.) The optimum amount to spend on, for example, obesity reduction simply has nothing to do with the amount you would collect from any "fat tax", and visa versa. (The technical name for the is a Pigou tax, incidentally. A carbon tax is a textbook example.)

by morrow 15y ago

kalmi10 15y ago

In Hungary they are taxing too fatty, too sweet and too salty foods. Oh.. and drinks with high coffeine content. http://www.chew.hu/welcome_to_the_maybe_healthy_a.html http://www.chew.hu/welcome_to_the_maybe_healthy_a.html Some foods' salty version costing twice as much as the non-salty version (for example peanuts). I can't say we like it...

protomyth 15y ago

They tried this with the tobacco taxes / settlements and just decided to spend it any way they wanted.

Codayus 15y ago

You're half right. If you think about it a bit, you'll work out that taxing "bad things" is a great idea, and that the proper tax rate is the net externality of the activity. We're not trying to stop the activity outright (if we were, we'd ban it); we just want to get rid of the "excess" activity. Since the excess is caused by a negative externality (ie, people aren't paying the full costs), if you set the tax to be equal to the externalities, everything comes back into balance. Spending the collected tax money on something related to what you're taxing (ie, cigarette taxes on curing cancer, or whatever) is entirely uneccesary. (Indeed, given the fungability of tax dollars, the concept doesn't even make sense.) The optimum amount to spend on, for example, obesity reduction simply has nothing to do with the amount you would collect from any "fat tax", and visa versa. (The technical name for the is a Pigou tax, incidentally. A carbon tax is a textbook example.)