Sin tax

Sin tax

"Sin tax" is a euphemism for a tax specifically levied on certain generally socially-proscribed goods - usually alcohol and tobacco. Sin taxes are often enacted for special projects - American cities and counties have used them to pay for stadiums - when increasing income or property taxes would be politically inviable. The proper name for such taxes is "sumptuary tax."

Some jurisdictions have also levied taxes on illegal drugs such as cocaine and marijuana. Whether this actually qualifies as a sin tax is rather questionable, since such taxes are generally intended to create an additional punishment for trading, possession or consumption of illegal drugs rather than to raise revenue.

Such taxes have historically triggered rampant smuggling and flourishing black markets, especially if they create large differences in the price of popular products in neighboring jurisdictions. Critics of sin taxes argue they are regressive in nature and discriminate against the lower classes, since in many jurisdictions they are more likely to be consumers of alcohol and tobacco and more likely to consume a greater quantity of it. Furthermore, sin taxes not normally value added in nature meaning that expensive, high-quality product more likely to be purchased by the wealthy will have the tax comprise a much smaller proportion of its final purchase price, thus ensuring that the lower classes pay a much greater proportion of their lower income in tax. Critics also argue that the behavior affected by sin taxes are strictly personal and of no social consequence, and therefore should not be moderated by government.

ee also

* Green tax shift
* Pigovian tax


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  • sin tax — ➔ tax1 * * * sin tax UK US noun [C, usually singular] INFORMAL TAX ► a tax charged on particular things or activities that are seen as bad and unnecessary, such as cigarettes, alcohol, or gambling: »Cleveland has used a sin tax to build stadiums… …   Financial and business terms

  • sin tax — sin′ tax n. ecn bus inf a tax levied on items, as cigarettes or liquor, considered neither luxuries nor necessities • Etymology: 1960–65 …   From formal English to slang

  • sin tax — n. a tax on a product or activity, esp. liquor, tobacco, or gambling, customarily regarded as sinful or harmful …   English World dictionary

  • sin tax — noun : a tax on substances or activities traditionally considered sinful (as tobacco, liquor, or gambling) * * * Informal. a tax levied on cigarettes, liquor, gambling, or other things considered neither luxuries nor necessities. [1970 75] * * *… …   Useful english dictionary

  • Sin Tax — A state sponsored tax that is added to products or services that are seen as vices, such as alcohol, tobacco and gambling. These type of taxes are levied by governments to discourage individuals from partaking in such activities without making… …   Investment dictionary

  • sin tax — noun Date: 1964 a tax on substances or activities considered sinful or harmful (as tobacco, alcohol, or gambling) …   New Collegiate Dictionary

  • sin tax — Informal. a tax levied on cigarettes, liquor, gambling, or other things considered neither luxuries nor necessities. [1970 75] * * * …   Universalium

  • sin tax —  Taxes on cigarettes and alcohol. The Clinton administration wanted to pay for expanded healthcare coverage through increases in sin taxes …   American business jargon

  • (a) sin tax — American, informal a tax on things that are bad for you, like cigarettes and alcohol. Politicians like a sin tax as it brings in lots of revenue and not too many complaints. (not used with the) …   New idioms dictionary

  • Tax shift — or Tax swap is a change in taxation that eliminates or reduces one or several taxes and establishes or increases others while keeping the overall revenue the same. [cite web url = http://sustainableprosperity.ca/about/faqs/#eight title = Will… …   Wikipedia

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