Wednesday, November 21, 2012

Sin-Tax Rides Again

Hunting for new revenue, the state administration (Kentucky) is angling for all the new taxes it can get away with. A possibility that has been floated is the increasing of taxes on a pack of cigarettes from 60 cents to $1.00. There’s no argument with this except that it just represents another example of the class warfare that marks the federal government these days, too. Let the smokers pay the freight!

The lead editorial in the Lexington Herald-Leader of 20 November was highly in favor of increasing the cigarette “sin tax” by the 50% mentioned above. Here is a claim in the editorial: “Type 2 diabetes is part of a grisly smorgasbord of disabling ailments that studies have linked to smoking.” Yeah…smoking contributes to heart disease, lung disease, throat disease and just about all other diseases anyone can imagine…probably a bad appendix, too.

However, the paper has been diligent in broadcasting the fact that OBESITY is a prime cause of diabetes, especially in Kentucky. Actually, obesity is a prime factor causing diabetes throughout the nation, whether people smoke or not. A prime factor in causing obesity/diabetes is the fact that the people – all people – have the nagging habit of eating, maybe half or more of them eating too much for their own good…so what else is new?

Would the obesity/diabetes problem be solved by installing a tax on food? Why not? Make the tax steep enough and folks will eat less, thus lowering their disposition toward diabetes. Of course, raising or leveling taxes on anything is designed to enhance revenue, meaning that if the tax discourages consumption the tax is useless or at least much smaller than anticipated.

Since such a tax would be much more discriminatory on retired folks or disabled folks or lazy folks, the old class warfare comes into play again. Or…why not base both the cigarette and food tax (and probably every tax) on the body-mass-index of people, thus making it attractive to be slim? Scanners in food-stores could instantly determine the BMI and charges adjusted accordingly. Again, loss of consumption means loss of taxes, so what’s a state to do?

A buyer can buy a horse in Kentucky for a cool million and pay no sales tax ($60,000) if he just ships it out of state. That’s a bone to the horse industry that’s indicative of how everything is done in Kentucky – based on the special interests of the people with enough money to buy from government anything they want. The horse can probably be shipped back later, but with its official residence somewhere else.

If there has to be an increase in the “sin tax” now, why not make it fair, the most destructive “sin” element in Kentucky being beverage alcohol? Imagine the amount of revenue to be collected if the current tax on alcohol were raised by 50%. Alcohol is known to cause everything from cirrhosis of the liver to brain damage to car/truck-wrecks that take thousands of lives every year. Beer-drinkers are known to stretch the bounds of (gasp) obesity/diabetes, just like cigarettes. Fair’s fair.

Okay…that introduces more class warfare, this time against the topers, unless, of course, booze is reclassified as a food, made of grain and all the rest. I don’t smoke and have never tasted beer or whiskey so I don’t have a dog in this fight tax-wise. What bothers me is the constant, unrelenting ability of the special interests to run the state. This includes all groups, from the teachers’ union to coal interests to tobacco growers to the horsy crowd to any outfit with the long-green.

According to a report by the U.S. Centers for Disease Control in September 2010, 20% of adults in the U.S. smoke. According to a report by Gallup in July 2010, 67% of U.S. adults drink alcohol. So…if revenue enhancement is a problem for the state and class warfare, as well as special interests, is to be the final arbiter of who pays the freight, a large part of the solution seems to be that the topers, who cause a great deal more misery, owe big-time, not the handful of smokers.

Alas, the smokers will probably get the hit, and if they don’t get out of the way fast enough, another kind of hit from a drunk driver.

And so it goes.
Jim Clark

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