I came across an article that expresses an interesting take on “sin taxes.”
Proponents of sin taxes (taxes on cigarettes, alcohol, soda, fatty foods, etc.) talk about public health benefits, but isn’t that still about money at the core? What I mean is, sick people run up big hospital bills, some paid by taxpayers through government services and some paid by the public in the form of higher insurance costs. If we can encourage people to avoid harmful foods and substances, then we can (according to sin tax proponents) reduce public health costs. Right?
Not so fast, says David Callahan with Huffington Post. If sin taxes are all about money, then the whole concept is flawed. The analysis is simple: most people who abuse their bodies die more quickly. They need medical care like anybody else, but presumably for a shorter fraction of their lives. It’s the “healthy” people who incur higher medical costs in the long run as their bodies slowly break down during old age.
The analysis is simple, but it’s the conclusion that gets tricky. Callahan is not suggesting that sin taxes are pointless because they can result in a healthier population, which can result in higher medical costs in the long term. That’s just a little macabre — he’s not saying that. He’s saying that the effects of sin taxes are inconclusive and need to be studied more, that’s all. And until there is conclusive evidence that they are effective, we should probably stand in favor of tax relief.
