Sin tax
Excise or sales tax specifically levied on goods deemed harmful to society
Excise or sales tax specifically levied on goods deemed harmful to society
A sin tax (also known as a sumptuary tax, or vice tax) is an excise tax specifically levied on certain goods and services deemed harmful to society and to individuals, such as alcohol, tobacco, drugs, soft drinks, sugar, fast foods, fat, meat, gambling, vaping, cannabis, and pornography. In contrast to Pigouvian taxes, which aim to pay for the damage to society caused by harmful products, sin taxes increase the price in an effort to decrease the use of these products. Increasing a sin tax is often more popular than increasing other taxes. However, these taxes have often been criticized for burdening the poor and for disproportionately taxing the physically and mentally dependent. The World Health Organization names health taxes the taxes on products that have a negative public-health impact (such as tobacco, alcohol and sugar-sweetened beverages). Health taxes reduce consumption of unhealthy products and prevent disease, while advancing health equity and mobilising revenue.
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