Misguided Taxes...
Washington state recently jacked up taxes on cigarettes by a dollar to cover their deficit. So I am quitting tobacco, or trying to yet again. :)
Why is this tax misguided? They raised it by 50 or so cents last year about this time, again to try to close the state deficit. I tried to quit then but didn't manage it, but a ton of people did quit and the state ended up losing money on it.
While I certainly agree that smoking is bad for both people and society, and in general I don't have a problem with sin taxes (I don't mind paying a bit more to the state to cover the problems that my "sins" generate for society), but I really have to wonder who comes up with bills like this, do they not know basic economics? If your tax causes a lot of people to stop using the taxed product, you've gained nothing. In fact, you've now lost even more money and damaged the local economy along the way. That corner store that was doing well, now has less people buying cigarettes, making less money and generating less tax revenue, possibly now going out of business due to less customers coming in for their "fix", who also bought other things along the way.
So the state again loses money. What the government needs to balance their budgets are new sources of revenue and more efficient spending, not jacking the tax on things that are already taxed to the hilt, but somehow legislators fail to see this really basic fact.
I really hate to beat a dead horse yet again, but if this country truly wants to make some headway on our deficit, we NEED to legalize recreational drugs. Prohibition has only helped the cartels and in general, increased crime. Tax the hell out of them as they already tax booze and cigs, save the enforcement/incarceration money.
I'm not saying that legalizing would solve all our deficit problems, but it surely would go a long way towards a balanced budget. We spend far too much on a pointless war on drugs that can never be "won", and to me, it would help secure our borders. As it stands today, drug smugglers get tons of product across our borders every month.
They are criminals already, I doubt they would balk at moving either personnel or weapons for terrorists. As long as the terrorists pay them, the drug cartels can easily move both personnel and hardware across the border. Given the tonnage of illegal drugs that come into this country now, I'm sure they could easily get even a crude, large and poorly made nuke into this country.
Ok, I digressed a bit there, but I do think my digression is relevant to my point :). We do have more options than just raising taxes on our current legal "sins".
Endlessly raising taxes on already taxed products will never work, as you will eventually hit a point where the taxed product becomes less used. The increased tax then becomes useless, as now not enough people are using the product (due to the increased tax) to generate income.
My 2cp.....
Oh and btw, I really want a cigarette right now... even with a patch. :)
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Why is this tax misguided? They raised it by 50 or so cents last year about this time, again to try to close the state deficit. I tried to quit then but didn't manage it, but a ton of people did quit and the state ended up losing money on it.
While I certainly agree that smoking is bad for both people and society, and in general I don't have a problem with sin taxes (I don't mind paying a bit more to the state to cover the problems that my "sins" generate for society), but I really have to wonder who comes up with bills like this, do they not know basic economics? If your tax causes a lot of people to stop using the taxed product, you've gained nothing. In fact, you've now lost even more money and damaged the local economy along the way. That corner store that was doing well, now has less people buying cigarettes, making less money and generating less tax revenue, possibly now going out of business due to less customers coming in for their "fix", who also bought other things along the way.
So the state again loses money. What the government needs to balance their budgets are new sources of revenue and more efficient spending, not jacking the tax on things that are already taxed to the hilt, but somehow legislators fail to see this really basic fact.
I really hate to beat a dead horse yet again, but if this country truly wants to make some headway on our deficit, we NEED to legalize recreational drugs. Prohibition has only helped the cartels and in general, increased crime. Tax the hell out of them as they already tax booze and cigs, save the enforcement/incarceration money.
I'm not saying that legalizing would solve all our deficit problems, but it surely would go a long way towards a balanced budget. We spend far too much on a pointless war on drugs that can never be "won", and to me, it would help secure our borders. As it stands today, drug smugglers get tons of product across our borders every month.
They are criminals already, I doubt they would balk at moving either personnel or weapons for terrorists. As long as the terrorists pay them, the drug cartels can easily move both personnel and hardware across the border. Given the tonnage of illegal drugs that come into this country now, I'm sure they could easily get even a crude, large and poorly made nuke into this country.
Ok, I digressed a bit there, but I do think my digression is relevant to my point :). We do have more options than just raising taxes on our current legal "sins".
Endlessly raising taxes on already taxed products will never work, as you will eventually hit a point where the taxed product becomes less used. The increased tax then becomes useless, as now not enough people are using the product (due to the increased tax) to generate income.
My 2cp.....
Oh and btw, I really want a cigarette right now... even with a patch. :)
I agree with Bob about the need to decriminalize marijuana and some other "recreational" drugs. The experience of Prohibition makes clear that any attempt to ban anything that a large number of people want will backfire. It does little to cut down use, and the money simply goes to organized crime--which now seems to include, virtually, some whole countries. Decrminalizing, taxation,. and regulation would benefit our economy.
But I can't agree to exempt raising taxes on tobacco, and I've seen no evidence that doing so results in less income from taxes. While the number of smokers does decrease yearly, the decrease is not sufficient to result in significant drops in tax income. Indeed, at least in the midwest, I've seen no reports of ANY drop.
And bans on smoking in public places, loudly protested by restaurants and bars, have NOT resulted in fewer people, especially in restaurants.
Bob's reason for trying to quit (aside from the health benefits!) are good. I quit smoking 40 years ago when I learned that smoking raised my life-insurance premiums by some 30%.