Today our newspaper had an article about how our provincial government is becoming addicted to tobacco taxes, which raised $780 million dollars for the government last year.
I submit that tobacco taxes are an abomination and a social injustice. I’m having a hard time seeing how anyone can support them.
From a Libertarian standpoint, tobacco taxes are an infringement on freedom. The government has absolutely no business punishing people with taxes to ‘encourage’ them to give up behaviour they choose to do.
From a social justice standpoint, tobacco taxes are highly regressive. Not only is the tax flat for all income categories, but poor people tend to smoke more than rich people. Which means that the government raised its revenue by $780 million dollars largely on the backs of the poor and middle class.
From a health standpoint, tobacco taxes don’t change behaviour all that much. Tobacco demand is highly inelastic, which means it doesn’t change much with changes in price. Here in Alberta, we tax Cigarettes $4 per package (over the counter, cigarettes are $10 a pack). And yet, smoking went up 1.6% last year.
So it seems to me that whether you’re on the left or the right, you should be opposed to tobacco taxes. So who is left to defend them? The puritans, the nanny-statists, and the government itself, which can spot a nice source of revenue a mile away.
Should tobacco taxes be eliminated?