With Snooki’s recent tanning tax escapade, sin taxes have been all the talk this summer. From soda to bottled water, tanning to smoking, taxes on ‘sins’ are everywhere. Some say that they appear to benefit everyone. From a government perspective, any money coming in is better than money going out. Plus, a healthier nation means a cheaper nation, and especially with nationalized healthcare, this could mean a lot. From an individual perspective, taxes serve as an extra incentive to quit a bad habit.
However, there’s always the opposing argument. Many argue that sin taxes are actually extremely detrimental to both society and the individual. The nature of sin taxes allows them to fall into the category of regressive taxes, as the amount paid remains constant on each individual unit. A regressive tax evidently hurts lower income individuals more so than others, as the rate is not adjusted for earnings. Sin taxes also make things vulnerable to black markets, which no country desires. Finally, sin taxes are subjective. While some items and actions may appear to be obviously ‘sinful,’ others could be arguably ok.
Whatever the case may be, we’ve got you covered. If you feel that sin taxes are just, follow our guide to find your coping mechanism. On the flip side, if you’ve chosen to stick your heels in and oppose the taxes, we’ve got some ideas for you, too.
The Tax: Cigarettes
The Angel’s Advice: Just quit! Quit, quit, quit! How many times do we have to say it? While smoking may be one of the hardest things to quit, it is notably one of the best. And, now besides saving your lungs, you could be saving your wallet, too. Spend your new found tax money on the patch, or invest in some tobacco-free chewing gum. Take baby steps and begin to wean yourself off cigarettes. Your body will begin to feel better, and, once you realize how much money you are saving, you’ll have no reason to go back.
The Devil’s Advice: Buy more cigarettes! Buy in bulk, and tax free, that is. Especially during the summer time, when vacations outside of the US are common- duty free purchases could save you a lot of money. The duty free cartons of cigarettes usually come in bulk, warehouse prices, so you’d save there, too. A carton of cigarettes oversees starts at about $90, which will score you 30 packs of 20 cigarettes each, breaking down to about $3 a pack. So, if you or someone you know is going on vacation, stock up!
The Tax: Soda
The Angel’s Advice: Drink something else. With today’s technology and abundance of retailers looking to break into the consumer beverage world, there are thousands of alternatives to sugary, fizzy sodas. Start by replacing your typical glass of soda with an iced tea, and, if you can, make it unsweetened. If that isn’t ‘your cup of tea,’ try drinking fruit punch or lemonade to satisfy your thirst. If you’re craving something bubbly, grab a seltzer.
The Devil’s Advice: Satisfy your soda craving where the tax hasn’t yet surfaced. We’re talking ordering those jumbo sized, discounted soda containers at your local fast food chain. Most chains have resisted raising drink prices and remain unaffected by the tax, leaving you to benefit.
The Tax: Tanning Beds
The Angel’s Advice: Swap the tanning bed for a stand up spray tan. You’ll get a similar effect without the added UV damage to your body, not to mention all of that sweating, and now, extra money, too! We understand and we’ve heard it time and time again, you don’t want to appear orange and fake. But these days, many salons offer the highest quality spray tans yielding the perfect bronzed result, seriously!
The Devil’s Advice: Buy a tanning package. Tanning packages usually offer discounts for weekly or even monthly unlimited tanning sessions. Rather than paying for an individual session or two every week, buy a week of unlimited tans and go every day. After that, wait until the next month and repeat the cycle. Or, up your tanning time outside- it is summer time, people! Grab your favorite magazine and head to the beach to soak up the rays.
The Tax: Bottled Water
The Angel’s Advice: Invest in a water bottle. Invest in a Brita filter. Put the two together and boom- you’ve got yourself “fresh” bottled-like water every single day. You’ll be saving money and the environment all at once. Besides, it’s much easier to refrigerate a water filter or bottle than a 24 pack of water. And in this heat, who doesn’t like cold water?
The Devil’s Advice: Head to your wholesale store and buy a few ginormous packs of water bottles- saving majorly on the bulk discount. Store them in your garage or in a cabinet and use them as needed. You’ll have a larger supply and you’ll have to struggle with carrying cases inside on a less frequent basis.
So, what’s your choice? Are you taking the advice of the angel; respecting the proposed or newly initiated taxes and optimistically running with them? Or, are you siding with the devil on this one, opposing the taxes and all that they claim to stand for? Regardless of the stance that you take, the sin taxes look like they are here to stay, or at least until we prove their effectiveness.
Even still, the question remains, what is the real purpose of the sin tax? Does the government truly wish to have a healthier nation, or are they just looking for another reason to tax their citizens? Is a sin tax actually capable of fighting off a bad habit, or does it just add fuel to the fire? Only time will tell.
I am a tax accountant with over 10 years experience helping taxpayers with tax liens, wage garnishment, tax audits, IRS penalties, and more. Visit my site at BackTaxeshelp.com