I want my taxes to be raised

[crash]

I have a question: what would be the effect on the economy of really jacking up the taxes on gas, cigarettes, and booze?

I mean, I know some jobs would be lost in certain industries. I suppose trucking would be affected (and therefore many products), maybe we could help out the truckers with subsidies or whatever.

In my (economically uninformed?) opinion, jacking up the taxes on these three things would have many good effects.

gas: everyone agrees that dependence on oil is a problem. Jack up the gas tax, make the cars makers give us more efficient cars, make more people take public transportation. cut down on pollution.

alcohol: problems with booze cost the country tons of money. Jack up the tax, people don't have to pay if if they don't want to. Ditto for smokes.


This lets us cut taxes in other areas. People get to decide whether they want to pay the extra taxes. What's wrong with the plan?

[meow_meow]

The obvious problem with this terrible plan is that it unfairly punishes the impoverished corporations that supply these goods - the exxon-mobils, the altrias and the anheiser-buschs of the world, and by extension, their shareholders. It should be obvious that the major shareholders of these companies are mutual funds, whose shares are in turn owned by the widows and orphans of the world.

To sum up, your plan involves the government stealing bread from the mouths of America's orphans. Shame on you.

[crash]

Right. I know you were kidding, but I wonder how much, say, a 25 cent/six pack tax increase would lower beer consumption. I bet not all that much. I know I'd still drink about the same amount.


Yeah, I know a candidate wouldn't have much of a chance with this, what with all the companies throwing money to the opponent.

[ThaSaltCracka]

Why? Because it's my money and I want to spend it on whatever I want. I also do not want to pay more for goods simply because the government decides to tax them. Another question is, where does this tax money go? My guess is half of it is wasted by governemnt agencies trying to enforce taxes.

[pokerjo22]

Jacking up taxes on such goods too much typically leads to an increase in the black market for such goods - i.e. more money in the hands of criminals.

[crash]

[ QUOTE ]
Why? Because it's my money and I want to spend it on whatever I want.



I also do not want to pay more for goods simply because the government decides to tax them.



Another question is, where does this tax money go? My guess is half of it is wasted by governemnt agencies trying to enforce taxes.

[/ QUOTE ]

I wasn't really trying to debate the overall level of taxes. Let's say the government plans to raise X dollars in taxes next year. My question was: why not do it my way, rather than more taxes on income, cap gains or whatever?

Well, given that we have to get the revenue from somewhere (see the above assumption), you have to pick something to be taxed. Better gas booze and cigs than higher income tax, right?

You point out another plus to my plan. It's a lot easier to enforce sales taxes than income tax and cap gains etc. The tax is collected at the sale. yet another reason to prefer sales taxes over other taxes, IMO.

[crash]

maybe--but more so in less developed countries, I'd guess. I can't really see a big underground black market in, say, gasoline in the U.S.

[Easy E]

we continue raising sin taxes (which include gambling, you heretic). Consumption of sin items falls off due to the cost, eroding the tax base of funds needed to run the gov't... eventually leading us to high sin taxes AND renewed income taxes to make up for the deficit

[Cashcow]

Why choose these goods? Why not Bottled water, bread and milk, or hell, groceries in general.

[crash]

[ QUOTE ]
we continue raising sin taxes (which include gambling, you heretic). Consumption of sin items falls off due to the cost, eroding the tax base of funds needed to run the gov't... eventually leading us to high sin taxes AND renewed income taxes to make up for the deficit

[/ QUOTE ]

True, if we raise the taxes too high, the activity will drop off and we lose a revenue base. A couple points:

You'd have to raise the taxes pretty high to substantially cut down on drinking and smoking (this coming from a drinker and on/off smoker).

Alcohol causes a LOT of problems and costs the country a lot of money. If drinking goes down, we lose a revenue base but we can also save money in police forces, hospitals, etc.

Re the gas revenue base: the less gas this country uses, the better, as far as I can tell. Then we wouldn't have to spend billions on middle east oil countries.

So I agree that your scenarios are possible, I just wonder if they would actually be bad.