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Smoking, Insurance, and Social Cost
Originally published in Regulation
Strong political resistance to new taxation has forced supporters of higher taxes to seek alternative justifications for the taking of more money from the public. That incentive, combined with the desire by many policy makers to control the behavior of others, has breathed new life into what used to be called sin taxes that traditionally targeted alcoholic beverages and tobacco products. But those taxes are now called “corrective taxes.” They supposedly compensate for the social costs that private behavior purportedly imposes on the public at large.
Strong political resistance to new taxation has forced supporters of higher taxes to seek alternative justifications for the taking of more money from the public. That incentive, combined with the desire by many policy makers to control the behavior of others, has breathed new life into what used to be called sin taxes that traditionally targeted alcoholic beverages and tobacco products. But those taxes are now called “corrective taxes.” They supposedly compensate for the social costs that private behavior purportedly imposes on the public at large.
Read the article at Regulation.
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