Are Sin Taxes good for Society? (In Progress)

To preface, sin taxes are excise taxes placed on certain products or activities that are considered harmful to society or individual people. They are intended to serve as a deterrence and a means to make society more healthy. The topic of this debate is whether these taxes serve as an effective and valuable deterrence or not. In this post, I support the opinion that they do.

Sin taxes are an effective way to reduce the amount of harmful behaviors that occur in society. These taxes reduce consumption of harmful goods, and improve the overall health of a population. Data from the Monitoring the Future Study and the Bureau of Labor shows that in a high income country, the price elasticity of tobacco products is around 0.4, meaning that a 10% change in price would result in a 4% change in consumption. Though this means that the change in consumption of these products is not equally proportional to the amount of tax put on the products, the taxes will certainly have an effect on the consumption to an extent– especially to those who have a low income to begin with. This demographic of low income tobacco users is actually quite important. In fact, as an article from the CDC says: Smoking prevalence overall was 41.1% among men with incomes below the federal poverty level. This means that sin taxes would be an effective way to reduce the percentage of tobacco users, especially those who are in poverty. The same principle applies to another product that, overall, has negative effects on people in society: alcoholic beverages, which (again in a high income country) actually has a bit higher elasticity: ranging from 0.51 to 0.77. On another topic, the long term effects of sin taxes are positive as well. People who may have been spending money on products such as tobacco and alcohol will become deterred and start spending money on other types of goods and services, allowing for more jobs to be given out to employees of certain corporations. On top of this, revenue from the sin taxes will be made by the government, allowing them to contribute to government expenditures. If there are no sin taxes charged on products like alcohol and tobacco, there is less stopping people from squandering money while getting addicted to harmful products at the same time. The government, of course, wants to put a limit on these harmful products, but cannot go to an extreme by banning the product. Actions like this have been seen during time periods such as the prohibition; which was a complete fail, as crime rates involving alcohol selling and drinking were very high. The movement was essentially counterproductive. If people are fully banned from consuming an addictive product, they will commit crimes if it means they can satisfy their addiction. On the contrary, people will consume too much of a negative product if there is nothing stopping them. This makes sin taxes a very reasonable, viable, and non-extreme step that the government can take to try and limit the consumption of what it deems a harmful product.