Another fat tax?

So now a ”fat tax” on salty, sugary and fatty foods could save 3,200 lives  in Britain each year, according to a new study published by Journal of Epidemiology and Community Health. Researchers at Oxford University. Researchers contend that charging a 17.5 percent levy on unhealthy foods would cut consumer demand, consequently reducing the number of heart attacks and strokes. Researchers employed a mathematical formula to figure this out.

US News and World Report first broached the idea of a sin tax in its 1996 “smart ideas to fix the world” issue and proponents have pushed the idea since. Yet, there is ample of evidence to suggest that it doesn’t work — even if you believe that punishing a citizen for eating one food over another is justified. 

The researchers hardly sound convinced.

However, they said their research only gave a rough guide to the number of lives that could be saved and said more work was needed to get an exact picture of how taxes could improve public health.

That sounds perilously close to making up your mind before you have all the facts. 

A recent study by three economics professors, Cheap Donuts and Expensive Broccoli: The Effect of Relative Prices on Obesity, estimates that a 100% tax on unhealthful foods would reduce average BMI by only 1 percent. The same tax could reduce the incidence of being overweight and the incidence of obesity by 2 percent and 1 percent respectively.

Smoking — the area most advocates like to hold up as a success on this front – has seen usage dropping for years before any sin tax was initiated. Furthermore, if the tax becomes too prohibitive, as it has in certain areas, a black market will soon surface. We’ve seen this underground economy growing across the nation and online.

Finally, sin taxes are inherently unfair – after all, not only unhealthy people eat unhealthy foods.  And they are also unfair to lower-income Americans, who studies show would feel the brunt of any sin tax.
 
I cover the topic of sin taxes extensively in my book.