View source for Sin tax

{{Distinguish|syntax}}
{{short description|Excise or sales tax specifically levied on goods deemed harmful to society}}
{{Use dmy dates|date=May 2017}}
{{Taxation sidebar}}

A '''sin tax''' (also known as a '''sumptuary tax''', or '''vice tax''') is an [[excise tax]] specifically levied on certain goods deemed harmful to society and individuals, such as [[Alcohol tax|alcohol]], [[tobacco taxation|tobacco]], [[drug policy|drugs]], [[soft drink]]s, [[sugar]], [[fast food]]s, [[Fat tax|fat]], [[meat tax|meat]], [[gambling]], [[vaping]], [[cannabis]] (wherever legal for recreational use) and [[pornography]].<ref>{{cite news|url=http://www.azfamily.com/story/35195078/bill-would-block-porn-on-new-phones-computers-unless-consumers-pay-a-tax |work=AZfamily.com |title=Bill would block porn on new phones, computers unless consumers pay a tax |first=Derek |last=Staahl |date=21 April 2017 |access-date=11 July 2017}}</ref>

In contrast to [[Pigouvian tax|Pigouvian taxes]], which are to pay for the damage to society caused by these goods, sin taxes increase the price in an effort to decrease the use of these goods. Increasing a sin tax is often more popular than increasing other taxes. However, these taxes have often been criticized for [[regressive tax|burdening the poor]] and disproportionately taxing the physically and mentally dependent.<ref>{{Cite web |last=Winck |first=Ben |title='Sin taxes' are meant to push people away from booze and cigarettes, but they mostly hit those who can least afford to pay |url=https://www.businessinsider.com/sin-tax-alcohol-cigarettes-soda-hit-people-low-income-education-2022-1 |access-date=2023-11-08 |website=Business Insider |language=en-US}}</ref>

The [[World Health Organization]] name '''health taxes''' the taxes on products that have a negative [[public health]] impact (such as [[tobacco taxation|tobacco]], [[alcohol tax|alcohol]] and [[sugary drink tax|sugar-sweetened beverages]]).<ref name=Ghebreyesus>{{Cite journal |author1=[[Tedros Adhanom Ghebreyesus]] |author2=Helen Clark |date=19 October 2023 |title=Health taxes for healthier lives: an opportunity for all governments |url=https://gh.bmj.com/content/8/Suppl_8/e013761 |journal=[[BMJ Global Health]] |pmid=37857436 |doi=10.1136/bmjgh-2023-013761 |doi-access=free |access-date=31 December 2025}}</ref><ref>{{Cite web |language=en |author=<!-- not stated --> |date= |title=Health taxes (Global Health Observatory) |url=https://www.who.int/data/gho/data/themes/health-taxes |publisher=[[World Health Organization]] |access-date=31 December 2025}}</ref> Health taxes reduce consumption of unhealthy products and prevent disease, while advancing health equity and mobilising revenue.<ref name=Ghebreyesus/><ref>{{Cite web |language=en |author=<!-- not stated --> |date=2 July 2025 |title=WHO launches bold push to raise health taxes and save millions of lives |url=https://www.who.int/news/item/02-07-2025-who-launches-bold-push-to-raise-health-taxes-and-save-millions-of-lives |publisher=[[World Health Organization]] |access-date=31 December 2025}}</ref><ref name=VitalStrategies/>

==Summary==
The enactment of sin taxes on harmful activities varies by jurisdiction. In many cases, sumptuary taxes are implemented to mitigate use of alcohol and tobacco, gambling, and vehicles emitting excessive pollutants. Sumptuary tax on sugar and [[soda tax|soft drinks]] has also been suggested.<ref>{{cite news|url=https://www.nytimes.com/2009/04/09/health/09soda.html |work=The New York Times |title=New York Health Official Calls For Tax On Drinks With Sugar |first=Anemona |last=Hartocollis |date=9 April 2009 |access-date=27 March 2010}}</ref> Some jurisdictions have also levied taxes on recreational drugs such as [[cannabis (drug)|cannabis]] where it has been [[Legalization of cannabis|legalized and regulated]].<ref>{{cite journal |last1=Hollenbeck |first1=Brett |last2=Uetake |first2=Kosuke |title=Taxation and Market Power in the Legal Marijuana Industry |journal=RAND Journal of Economics |date=2021 |volume=52 |issue=3 |pages=559–595 |doi=10.1111/1756-2171.12384 |ssrn=3237729 |url=https://mpra.ub.uni-muenchen.de/106618/1/MPRA_paper_99877.pdf}}</ref>

Revenue generated by sin taxes supports many projects imperative in accomplishing social and economic goals.<ref>{{cite web|last1=Bennett|first1=Cory|title=Proposed 'Sin Tax' on Cigarettes Sparks Hope for Preschools|url=http://www.nationaljournal.com/daily/proposed-sin-tax-on-cigarettes-sparks-hope-for-preschools-20130411|website=National Journal|access-date=21 February 2015|archive-url=https://web.archive.org/web/20150221194252/http://www.nationaljournal.com/daily/proposed-sin-tax-on-cigarettes-sparks-hope-for-preschools-20130411|archive-date=21 February 2015}}</ref> American cities and counties have utilized funds from sin taxes to expand infrastructure,<ref>{{cite web|last1=Trickey|first1=Erick|title=Sin tax extension would push public funding of stadiums past $1 billion |url=http://clevelandmagazinepolitics.blogspot.com/2014/04/sin-tax-extension-would-push-public.html|website=clevelandmagazinepolitics.blogspot.com|date=28 April 2014|access-date=21 February 2015}}</ref> while in Sweden the tax for gambling is used for helping people with gambling problems. Public acceptance of sumptuary taxes may be greater than income tax or [[sales tax]].

== Design ==
[[File:Health taxes.png|thumb|Possible elements of a health tax include: [[per unit tax|specific tax]], [[Ad valorem tax|''ad valorem'' tax]], tax floor or [[Price floor#Alcohol|price floor]], [[indexation]] to [[inflation]] and [[hypothecated tax|earmarking]] for health programmes.<ref name=VitalStrategies/>]]

Compelling evidence show that health taxes are one of the most effective ways to reduce the consumption of unhealthy products and prevent diseases.<ref name=Ghebreyesus/><ref name=VitalStrategies/> Key elements of health taxes include:<ref name=VitalStrategies>{{Cite web |author=<!-- not stated --> |date=2025 |title=Health Taxes Action Guide: A Road Map for Policymakers |url=https://www.vitalstrategies.org/wp-content/uploads/Vital-Strategies-Health-Taxes-Action-Guide.pdf |publisher=Vital Strategies |page=9 and 15 |quote=Appendix 3: Key Elements of Health Tax Design |access-date=24 December 2025}}</ref>
* [[per unit tax|Specific tax]] (per quantity) and/or [[Ad valorem tax|''ad valorem'' tax]] (percentage of value), tax floor or [[Price floor#Alcohol|price floor]];
* Automatic adjustment to [[inflation]] ([[indexation]], not to get more affordable over time);
* Partial or full [[hypothecated tax|earmarking]] of the revenue for related health programmes;
* Comprehensive definition of products included (broad base to avoid [[loophole]]s);
* Design according to health goal, for instance taxing the [[Alcohol tax|alcohol]] or [[Sugary drink tax|sugar]] content;
* Explicit health rationale in the law, to reinforce the legal and political legitimacy;
* Requirement for monitoring and reporting to recalibrate every 2-3 years.

==Support==
*Proponents argue that the consumption of tobacco and alcohol, the behaviors associated with consumption, or both consumption and the behaviors of consumption, are immoral or "sinful", hence the label "sin tax". For example, [[Mayo Clinic]] anesthesiologists [[Michael Joyner]] and David Warner support increasing taxes on tobacco and alcohol, with the goal of using tax codes to help change behavior and improve health.<ref>{{cite web|last1=Perry|first1=Susan|title=Mayo doctors propose higher — and new — 'sin taxes'|url=http://www.minnpost.com/second-opinion/2013/06/mayo-doctors-propose-higher-and-new-sin-taxes|website=Minn Post|date=5 June 2013|access-date=21 February 2015}}</ref>
*Tobacco and alcohol consumption has been linked to a variety of medical problems. In the United States alone, over 440,000 annual deaths are considered to be related to smoking tobacco.<ref name=tobaccodeath>{{cite web |url=https://www.fda.gov/TobaccoProducts/NewsEvents/ucm173174.htm |archive-url=https://web.archive.org/web/20090801091118/http://www.fda.gov/TobaccoProducts/NewsEvents/ucm173174.htm |archive-date=1 August 2009 |work=FDA |title=Frequently Asked Questions on the Passage of the Family Smoking Prevention and Tobacco Control Act (FSPTCA) |date=10 August 2009 |access-date=27 May 2010}}</ref><ref>{{cite web|title=Alcohol and Tobacco|url=http://pubs.niaaa.nih.gov/publications/AA71/AA71.htm|publisher=National Institute of Health|access-date=21 February 2015|archive-date=27 February 2015|archive-url=https://web.archive.org/web/20150227070242/http://pubs.niaaa.nih.gov/publications/AA71/AA71.htm}}</ref> A synthesis of 67 studies found that there was evidence indicating tobacco taxation is responsible for "reducing smoking behavior among youth, young adults, and persons of low socioeconomic status, compared to the general population," although no evidence was found indicating this was true for long-term smokers or [[Native Americans in the United States|American Indians]].<ref>{{cite journal|pmc=3228562 |pmid=22163198 |doi=10.3390/ijerph8114118 |volume=8 |issue=11 |title=Effects of tobacco taxation and pricing on smoking behavior in high risk populations: a knowledge synthesis |journal=Int J Environ Res Public Health |pages=4118–39 |last1=Bader |first1=P |last2=Boisclair |first2=D |last3=Ferrence |first3=R |year=2011 |doi-access=free }}</ref>
*Following the medical argument, consumers of tobacco and alcohol cause a greater financial burden on society by forcing others to pay for medical treatment of conditions stemming from such consumption, especially in most first-world countries with government-funded healthcare.<ref>{{cite web|title=Drug abuse costs the United States economy hundreds of billions of dollars in increased health care costs, crime, and lost productivity.|url=http://www.drugabuse.gov/publications/addiction-science-molecules-to-managed-care/introduction/drug-abuse-costs-united-states-economy-hundreds-billions-dollars-in-increased-health|website=National Institute of Drug Abuse|access-date=21 February 2015}}</ref><ref>{{cite journal |pmid=9744130|year=1998|last1=Single|first1=E|title=The economic costs of alcohol, tobacco and illicit drugs in Canada, 1992|journal=Addiction|volume=93|issue=7|pages=991–1006|last2=Robson|first2=L|last3=Xie|first3=X|last4=Rehm|first4=J|doi=10.1046/j.1360-0443.1998.9379914.x|s2cid=23103250}}</ref><ref>{{cite web|title=How does tobacco use affect the economy?|url=http://www.cancer.org/cancer/cancercauses/tobaccocancer/questionsaboutsmokingtobaccoandhealth/questions-about-smoking-tobacco-and-health-tob-and-economy|website=cancer.org|access-date=21 February 2015|archive-date=19 February 2015|archive-url=https://web.archive.org/web/20150219011758/http://www.cancer.org/cancer/cancercauses/tobaccocancer/questionsaboutsmokingtobaccoandhealth/questions-about-smoking-tobacco-and-health-tob-and-economy}}</ref><ref>{{cite web|last1=Bloom|first1=D.E.|last2=Cafiero|first2=E. T.|last3=Jané-Llopis|first3=E.|last4=Abrahams-Gessel|first4=S.|last5=Bloom|first5=L. R.|last6=Fathima|first6=S.|last7=Feigl|first7=A. B.|last8=Gaziano|first8=T.|last9=Mowafi|first9=M.|last10=Pandya|first10=A.|last11=Prettner|first11=K.|last12=Rosenber|first12=L.|last13=Seligman|first13=B.|last14=Stein|first14=A. Z.|last15=Weinstein|first15=C.|title=The Global Economic Burden of Non-communicable Diseases|url=http://www3.weforum.org/docs/WEF_Harvard_HE_GlobalEconomicBurdenNonCommunicableDiseases_2011.pdf|website=World Economic Forum|publisher=Geneva: World Economic Forum|access-date=21 February 2015}}</ref>
* The moral, medical and financial arguments are occasionally considered in contemporary news settings.<ref name=taxingsoda>{{cite news |url=http://www.news-record.com/content/2010/03/19/article/allen_johnson_should_my_diet_dew_addiction_be_punished_with_a_tax |work=News & Record, Greensboro, NC |author=Allen Johnson |title=Should my Diet Dew addiction be punished with a tax? |date=21 March 2010 |access-date=27 May 2010}}</ref>

==Opposition==
*Sin taxes result in the illegal manufacture, [[smuggling]] and/or outright theft of the taxed products, sometimes for personal use but often for sale on the [[black market]].<ref>{{cite news|url=https://www.bostonglobe.com/ideas/2014/02/02/boston-black-market-cigarette-problem/mJpfuuFZXXYxrBiEgTcyJM/story.html |work=The Boston Globe |title=Boston's black-market cigarette problem |first=Kevin |last=Hartnett |date=3 February 2014 |access-date=29 April 2017}}</ref><ref>{{cite news|url=https://www.telegraph.co.uk/news/2016/11/14/sin-taxes-on-alcohol-and-tobacco-have-cost-the-treasury-more-tha/ |work=The Daily Telegraph |location=London |title=Sin taxes on alcohol and tobacco have cost the Treasury £31bn, analysis finds |first=Peter |last=Dominiczak |date=14 November 2016 |access-date=29 April 2017}}</ref>
*Critics of sin tax argue that it is a [[regressive tax]] in nature and discriminates against the lower classes. Sin taxes are often assessed at a flat rate meaning they account for a much larger portion of the price of an x by the wealthy. Also, sin tax rates products such as alcohol or cigarettes typically do not account for ability to pay, therefore poor people pay a much greater share of their income as tax.<ref>{{cite web |url=http://mercatus.org/publication/sin-taxes-size-growth-and-creation-sindustry |title=Sin Taxes: Size, Growth, and Creation of the Sindustry |first1=Adam |last1=Hoffer |first2=William |last2=Shughart |first3=Michael |last3=Thomas |publisher=Mercatus |date=February 2013}}</ref ><ref>{{cite journal |title=The Consequences of High Cigarette Excise Taxes for Low-Income Smokers |journal=PLOS ONE |volume=7 |issue=9 |article-number=e43838 |first1=Matthew |last1=Farrelly |first2=James |last2=Nonnemaker |first3=Kimberly |last3=Watson  |publisher=PLOS |date=September 2012|doi=10.1371/journal.pone.0043838 |pmid=22984447 |pmc=3440380 |bibcode=2012PLoSO...743838F |doi-access=free }}</ref>
*Critics also argue sin taxes fail to affect consumers' behaviors in the way that tax proponents suggest, for instance increasing smokers' propensity to smoke cheaper, high-tar, high-nicotine cigarettes when the per-pack tax is raised<ref>{{cite web |url=http://mercatus.org/publication/taxing-sin |title=Taxing Sin |first1=Richard |last1=Williams |first2=Katelyn |last2=Christ|publisher=Mercatus |date=July 2009}}</ref> and increasing the rate of people mixing their own drinks rather than buying pre-mixed alcoholic spirits.<ref>{{cite web |url=http://www.watoday.com.au/national/alcopops-sales-down-but-spirits-booming-20080728-3lvu.html |title=Alcopops sales down, but spirits booming |date=July 2008}}</ref>
*The government may become reliant on the revenue from the tax and have to encourage "sinful" behavior in order to maintain the revenue stream.<ref>{{cite web|title=Detailed Response to Contradictions|url=http://www.climateactionnow.ca/carbon-pricing/capndivresponse|publisher=Climate Action Now|access-date=30 April 2013|quote=When we rely on a sin tax for general revenues, we have a perverse incentive to maintain that revenue stream.  It hurts government services when Canadians reduce their use of fossil fuels.|archive-date=29 April 2015|archive-url=https://web.archive.org/web/20150429122018/http://www.climateactionnow.ca/carbon-pricing/capndivresponse}}</ref>

==See also==

;Products
* [[Alcohol tax]]
* [[Fat tax]]

* [[Meat tax]]
* [[Sugary drink tax]]
* [[Tobacco taxation]]

;Concepts
* [[Consumption tax]]
* [[Demerit good]]
* [[Ecotax]]
* [[Excise]]
* [[Land value tax]]
* [[Müskirat resmi]]
* [[Paternalism]]
* [[Wagering excise taxes]]

== References ==
{{reflist}}

{{Alcohol and health}}

{{DEFAULTSORT:Sin Tax}}
[[Category:Personal taxes]]
[[Category:Tax terms]]