Tax on sin and luxury products may help kill addiction

IT IS SIGNIFICANT THAT THE CESS WILL BE APPLIED ON GOODS, WHICH ARE IMPORTANT CONTRIBUTORS TO THE HEALTH CRISIS

Now, I am not one for government policing of morality, but this tax is one I support.

This paper recently reported a capped cess “on demerit goods — so-called sin and luxury products — such as cigarettes, alcohol, colas and cars at 15%. That means the total tax incidence on sweetened drinks and cars cannot be more than 43% — tax rate of 28% plus cess of 15%.”

Although I would have liked plastic packaging and bags, pesticides and household goods with toxic chemicals to have been additionally taxed, this is an excellent start.

It is significant that the cess will be applied on goods which are important contributors to the health crisis, apart from being polluters.

Cars have made our lives convenient, but at the cost of unbreathable air and killing state incentive to provide top rate public transportation. Cigarettes have a known black history. Colas are not only junk food being banned in many schools in this era of childhood obesity, but some of the best-known brands have been embezzling ground water from under their factories, even during the current harsh drought in many parts of South India. And clearly, we always need water before we need cola.

Like many, I too am speculating about GST’s impacts. But as an environmentalist, I am glad we are finally creating dis-incentives for the stuff that deserves these. There isn’t another way to kill our addiction to these.