Monday, 30 July 2018

Taxing the poor

I wrote an article for City AM on Friday about the regressive nature of sin taxes and the disingenuous attempts by the Lancet, WHO, Bloomberg etc. to deny this basic economic fact.

Whichever way you look at them, these taxes clobber the poor. Public health campaigners don’t want to admit this, even to themselves, because they see themselves as champions of social justice.

The cost to the average British family of the recently implemented sugar levy will be relatively trivial, but it would rise to £500 a year if the government introduced the kind of taxes that Bloomberg wants to see on food and drink.

Taxes on alcohol and tobacco already cost UK consumers £24bn a year. Yes, governments need to get money from somewhere, and not every part of the tax system can be progressive. But campaigners for more sin taxes should admit that it is the poor who suffer more than the rich.

Do read it all, and if you haven't downloaded my little report that looks at the evidence, it's here.

There is also a decent article in this week's Economist about sin taxes. It uncritically repeats the fake news about Mexico's sugar tax but covers both sides of the debate well. It also cites IEA research on the financial costs/benefits of smoking, drinking and obesity to the UK's public finances.

Why not read that too?

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