The Next Sin Tax – Twinkies & Ice Cream? A Look at the Food Sin Tax
A New Sugar Sin Tax?
According to Kiplinger, “Folks who represent the food and beverage industry are fighting an all-out war against a federal excise tax on sodas, fruit drinks, sports drinks and other sugared beverages. They are determined to make sure that Congress doesn’t approve such a tax to help offset the cost of health care reform legislation, and they even launched an advertising blitz costing a reported $2 million to make their point. There’s just one problem: No major health care bill pending in Congress includes such a tax.”
I’m not on the new taxation bandwagon, but I like this idea. I drink alcohol responsibly, yet I see the validity behind taxing it – drinking causes an overall increase in health care expenses that we ultimately all end up paying for one way or another. So why not tax the product that is leading to the expense increase? Smoking? Even moreso.
Why I like the Food Sin Tax
So what’s different about taxing high sugar or high fat foods? Obesity is a HUGE problem in this country that has driven up health care premiums for us all. Those who abuse the system through careless food consumption habits should have to pay for it, in my opinion. Not only does it deter the consumption of these foods (which lowers health care expenses for all of us), but it also forces the hand of the market to create healthier food. That’s something that we can also all benefit from.
Food Sin Tax Discussion:
- Do you like the idea of taxes on ‘sin’ foods that are high in sugar and fat?
- What do you think of sin taxes in general?
- What else would you tax (if anything)?
Related Posts:
I am G.E. Miller, & 
I absolutely think that we should have a sin tax for high-fat, high-sugar items. I also think there should be a sin tax on meat, to offset the greenhouse gas emissions of the industry. Also, let’s say, any standalone, single-family home that is more than 2500 square feet and/or costs over $300,000, any car that costs over $30,000 and/or gets less than 25 mpg, city. Slap a sin tax on marijuana and sell that, too. Oh, and start taking away the tax credit for people who’ve had more than 2 kids.
The thing about sin taxes is, it’s making you pay up front for the havoc you’re wreaking later, and I think that makes them a good thing. Do what you like, but take the TRUE cost into account.
Such a tax is a good idea if it builds in incentives for producers to alter their product lines and for consumers to change their behavior. However, for it to be effective, it needs to be “in your face” all the time to remind everyone that they are paying a premium because what they are consuming is bad for them.
Though controversial, I would also suggest a health tax based on measures of activity and obesity. If it cost people to be inactive, there would be incentives to become more active. Doing so is likely very problematic however and would take considerable effort to put in place.
You know what is funny? Is that this tax has NOTHING to do with the govt wanting us to be healthy. Its has EVERYTHING to do with the moron in office who just spent a trillion dollars. How else was he suppose to pay for stimulus? It is called creeping incrementalism. Tax a little here, tax a little there, tax a little more here. It doesn’t seem so bad when its creeping slow.
And for all you kool-aide drinkers out there that dont think it is about paying for the out of control spending….Why should I be punished for all the fatso’s out there that can’t control themselves? I eat healthy and I am in great shape. But every once in a while, I like to treat myself and have a soda, or a candy bar. Why should I be punished for that?
I find it incredibly ironic that we’re paying Billions of dollars out to farmers annually in the form of sugar subsidies. Then, because sugar is too cheap and we’ve flooded the market with crap that has made us fat, we don’t revisit the problematic policy of sugar subsidies… instead we focus attacking the symptom by taxing a completely subjective set of foods. And let’s be honest, taxing one set of foods will only divert people to a different set of foods or manufacturers to produce new products that skirt the taxation requirements.
Rather than working ourselves into a bigger tangle than we already have, let’s review the rationale for the huge sugar and corn (high fructose corn syrup) subsidies we give in this country and see if the underlying reason we started them is still valid. I suspect it isn’t. We should then phase them out, which will in the long term help raise the costs of foods, but will hit items like these hardest.
I think this could be a good thing. We already have high taxes on other items, if the government wants health care issues fixed, charge more for bad food options.
A sin tax on high-sugar food items should help offset obesity related health care costs.
In response to Jeff’s comment, we are already paying for the health care costs of people who cannot afford their care. Whether it is through higher premiums or through taxes, we are implicitly supporting the people “that can’t control themselves”. This tax would help offset some of those costs.
Of course in a broader sense, whether or not this tax would help some people make healthier food decisions depends on how elastic the demand is for high-sugar goods. One of the reasons the sin tax on cigarettes work so well is that the price elasticity is high: a small increase in price will cause a proportionally larger decrease in consumption. I would like to see some information about price elasticity in relation to high-sugar foods. Given the generally low prices on these foods, maybe the elasticity is pretty high.
@ Jeff – but you DO pay for everyone else to be obese, since they don’t have health insurance and instead rely on emergency services, which are provided even to those who can’t pay. And yes, we need to increase taxes to pay for the stimulus, but that doesn’t mean it wasn’t money well spent.
I do agree with those who brought up the point of the sugar and corn subsidies going on in this country, which is more than half of the problem anyway. Excellent point – and I agree that if we did away with those subsidies, the prices would probably go up enough to make such a tax moot.
I do think that instead of a “health tax” for those who are obese, it would be more productive for health insurance to cover preventative care, including a nutritionist and a gym membership (and potentially making things like personal training available with simply a co-pay). Expensive? Yes. Cheaper in the long run than letting everyone become morbidly obese and be treated for diabetes and a host of other illnesses? Also yes.
I think that taxing this stuff is a good idea. The tax has worked well on things that have been proven to be detrimental to health such as cigarettes and booze, but not for sugar? What gives? Type 2 diabetes is going to become a huge problem, and we are all going to pay for that, as is heart disease. These things also kill people prematurely, and can be cause by lowering intake of certain foods. A tax can help do that.
I say go for it, if it changes behavior, everyone will wonder what took people so long to do it.
Yeah, the tax isn’t because of the health value of the product. Taxes on items that are stable in consumer spending (gas, cigarettes, alcohol) get taxed specially because they are consistent areas of revenue. Why else would the Brits tax tea?
Sin taxes work well in theory, in practice however they engender many moral dilemmas.
Take cigarettes for example, heavily taxed in every state. When you look at who pays this tax, it’s almost entirely paid by undereducated, low income citizens. Many of which have mental diabilities. Doesn’t seem entirely fair that segment of society should pay a disproptionate amount for what is really just a personal choice.
Also, sin taxes are notoriously ineffective. They drive growth in black markets. When cigarette taxes went up in NYC in the late 90′s, the number of cigarettes smoked stayed the same while the adjusted tax revenue dropped by a whopping 25%!
Finally, the idea of the government using taxes to discourage behavior seems draconian and wrong to me.
Did you see that study that just came out about the 10 most dangerous foods for getting food-born illnesses? I think we really need to start taking lettuce heavily in order to combat the strain these illnesses put on our health care system.
I am completely support the sin taxes.’sin’ foods cause too healthy problems.For that,I am really fat and I am really hate ‘sin’ foods.
There is nothing wrong in paying taxes on sin foods but were these taxes implement because the officials has concern for its citizenry this is the question that is being asked. Are the same citizenry will take heed and recognize that these sin foods are detrimental to them? These sin foods are being purchase by the poor because they see it as comfort zone why should it be heavily tax?
Twinkie Tax…I thought we were living in AMERICA?
@ Robert – yes, the most obese nation on the planet.
Sometimes these types of taxes are just pure revenue raisers for governments. I can undersatnd that certain products have detrimental health effects such as drinking alcohol & smoking cigarettes but it is the peoples choice to consume them.
You should see the tax on pre-mixed alcoholic drinks in Australia. It has gone through the roof and was introduced to stop teenagers from drinking.
Well how silly, teenagers now buy full bottles of spririts and mix it themselves. Does not solve the teenage drinking issue but does increase tax revenue on the pre-mixed drinks purchases.
I’ve been evangelizing this idea to anyone who will listen for a long time. I had no idea that it might become a reality. So many public health problems could be solved, plus sorely needed revenues raised, by simply taxing the stuff that’s bad for us to death. We do it for alcohol and tobacco. Sugary foods are deadly too. Just look at the type 2 diabetes rates in this country. A tax on red meat wouldn’t hurt either…
I wonder, though. Maybe we shouldn’t be taxing raw sugar that we use for baking. Shouldn’t it be convenience foods? Should we be taxing betty crocker?
Sin Tax!!! Since when is the government able to tell me what I can eat and further, enact punitive measures (taxes) if I disagree with their choices. How about abolishing all sin taxes including those on cigarettes and liquor.