Fri, 20 Jul 2007

Bush Administration Fighting New Cigarette Tax Hike

Well, you would probably expect an unrepentent smoker such as myself to be mighty upset over this, especially given that we in Indiana have just raised cigarette taxes for the very same reason. But I'm not - and I'll tell you why.

First off, I'm not sure the Senate can override a veto on this, even though Bush the Idiot is opposing it for all the wrong reasons - this has nothing to do with "government taking over health care". Second, because this offers a perfect opportunity to teach my non-smoking (or non-drinking, non-gambling) friends how raising "sin" taxes is really just a ruse for a general tax increase: one that "non-sinners" will ultimately pay.

When Indiana raised it's cigarette taxes recently, the legislature commissioned very careful studies - how many smokers would actually quit because of the new tax, and how much money would actually be raised. Once this estimate was in hand, they funded programs based on the numbers.

But, of course, now come the Feds, bound and determined to do the same thing. If this new Federal tax is imposed, the number of smokers in Indiana will drop much further that the Indiana legislature predicted, leaving our State cigarette tax funded programs with a serious shortfall.

Does anyone seriously think the legislature will pare those programs back?

The shortfall will be made up from general tax revenues, and will either contribute to a deficit or a general tax increase.

And since the professed goal of sin taxes is to reduce sin, ultimately all sin taxes are general tax increases - unless they fail to work, which kinda defeats the professed purpose, eh?

A new tax on cigarettes, that would be used to fund children's health insurance, is opposed by the administration, which fears insurance costs will pass to the government.

(link) [Wired Top Stories]

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