The Sticky Facts on Soda Taxes: Why They Don’t Work (And No One Likes Them)

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Taxes in Western countries were traditionally meant to raise money for necessary government expenditures. They weren’t supposed to shape individual behaviour, let alone attempt to turn taxpayers into better human beings. Free-market economists later added the principle that taxes should seek to minimize damage and distortion to both the economy and taxpayers. So what should we make of a new tax that is essentially moralistic in purpose, damaging to those least able to afford it and likely doomed to failure? Peter Shawn Taylor delves into debt-ridden Newfoundland and Labrador’s plan for a new tax on sugary beverages, and the formidable array of international evidence that argues against it.