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The self-defeating nature of sin taxes

 

Rev. Ben Johnson, senior editor at the Acton Institute, wrote a new article for CapX warning bishops of the dangers of encouraging sin taxes.

Recently in Poland, a letter written by bishop Tadeusz Bronakowski was read aloud in many Catholic churches, stating that the "state has a 'responsibility' to pass laws limiting alcohol’s 'physical and economic availability,' and to back them up with 'ruthless enforcement.'" Johnson, however, asks bishops take a look at historical records regarding sin taxes and reconsider their stance, explaining how past and present sin taxes have resulted in a burgeoning black market. 

His examples range from Prohibition to last week's vote by the New York City Council to raise the price of cigarettes to $13 a pack. "Research found that roughly half of all cigarettes, and one-quarter of all alcohol, consumed in New York City is bought on the black market," he wrote. Further, the illegal trade has financed terrorists, including al-Qaeda.

To cement his argument, Johnson cited an alarming statistic of the black market surrounding the sin tax on tobacco:

According to the Centre for the Analysis of Terrorism in France, 15 international terrorist organisations, including the IRA and FARC, benefit from illegal cigarettes: the smuggling accounts for 20 per cent of those groups’ revenues. Pakistani militants made more money from the illegal tobacco trade than any other source besides heroin.

Bishops should restrain from spurring on sin taxes as they are evidently self-defeating. "It is imperative that the  coalition of bootleggers and Baptists of old doesn’t give way to the less likely, more dangerous pairing of bishops and bombers today." 

Johnson's article can be read here.

(Photo: Public Domain (CC0 1.0)) 

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Caroline Roberts is a writer and producer of the Acton Line podcast.