Quote:
Originally Posted by MoneyGuy
Of course not, but higher cigarette taxes is reasonable. Although I love my Coke Zero I’d also support a sin tax on junk food.
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I guess it depends.
Right now there are two primary mechanisms for directing behaviours. Taxation and Legislation. For purpose of simplicity I'll exclude costs for Education and other forms involved as they dont wield the same kind of measurable results.
Like...how effective was: "When it comes to Drugs and Alcohol....Just Say NO!" ?
I dont know how much that Campaign cost but I'd wager that if there was a method of measuring the effectiveness of it versus its actual cost we'd all be pretty disappointed but ultimately not all that surprised.
As with most things when you're using these primary tools to alter behaviour, typically a mix is most effective.
Sin Taxes are typically quite effective and lucrative, if you can price the vice to a point that a user simply decides to quit then you've achieved the desired result.
Thats not so cut and dried though. Some people are hardcore and will sacrifice elsewhere in their lives in order to maintain their vice, but if you get some to acquiesce then progress is still being made as you're reducing some negative effects while still generating revenue.
The economic element of that though is that the revenue received really has to go to the desired and correct environment.
Ie. If you tax the hell out of cigarettes, that revenue should be allocated directly to Health Care. But it wont be.
The legislative end is more murky.
This is because while the Taxation method generates revenue, the legislative method incurs costs.
Costs of enforcement, training, administration, detainment and punishment.
And of course the ancillary knock-on effects; Black Markets, loopholes, disdain from law enforcement, etc.
The tipping point is where the Sin Tax effectively just covers the cost of administration of the legislation and there is no additional funding to cover the actual Health Care costs incurred while simultaneously not materially moving the needle to solve the original concern.