Can We Tax Our Vices Away?

Jan 11 2013 @ 2:22pm

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Despite a recent study (paywalled) showing that adding a 20% tax to sugar-sweetened beverages "would translate into an average weight loss of 1.6 pounds during the first year and a cumulated weight loss of 2.9 pounds in the long run," Aaron Carroll remains skeptical:

[W]e can debate how valuable 3 pounds of weight loss is. We can also debate as to whether a 20% tax is politically feasible. But at least it appears that a tax might produce some results. Fighting obesity is so difficult that sometimes I despair that anything would work. I also appreciate the addition of evidence to this debate. But if you’re asking my opinion, I think that any implementable tax would likely not yield results that would make a difference in the real world. We need a holistic solution. Keep working.

Relatedly, Kleiman suggests raising taxes on alcohol:

Doubling the federal alcohol tax from the current ten cents per drink to twenty cents would reduce homicide and automobile fatalities about about 7% each, saving about 3000 lives per year. It would cost a two-drinks-per-day drinker (at about the 80th percentile of all drinkers about $6 per month. (Fully internalizing the external costs of drinking would involve taxes nearer a dollar a drink.)

My own immediate free association is Britain, where vice taxes are ginormous and almost everyone is, by American standards, an alcoholic.

(Photo: some victims of Oktoberfest by Getty Images.)