Principles of Economic
Check Point #6
Excise Tax: Good or Bad
An Excise tax is a type of tax that it is charged on goods produced within the United States. It is considered under the many sales taxes currently being applied to either customer or producer of certain good. The Excise tax is levied on the producers of the goods, commodities and activities that qualify under the government list. Usually, the tax is set as a fixed amount per unit of measure or unit produced; like for instance a gallon of gasoline or one bottle of liquor. Even though there is a list that the government can produce with all the goods that can be excise taxed, there is no concrete definition that can help decide what goods would automatically qualify as excise taxable goods, for this reason the government can not provide the parameters on how it decides on the goods that will be taxed in such way but only the list of goods that are already chosen by the government.
Some of the goods that are taxed not only federal but also state as an excise tax goes as follow: alcohol, environmental taxes, gambling, tobacco, oil and gasoline. When we analyze the list of goods and activities that are being excise taxed we can see that most of them are either bad for the health of a human being or can be problematic to the serenity of a human being. This led us to research the beginnings of the excise tax. Adam Smith says, “The motive for the implementation of excise should be nothing more than to curb the pursuit of goods and services that can be harmful to our health and morals.” However we have Samuel Johnson saying, “Excise † A harmful tax levied on commodities, and adjudged not only by the common judges of property, but wretches hired by those who excise is paid.”
Deducing from both comments and theories we can say that the tax is applied originally for the following reasons:
• To protect people: from harming themselves or others by abusing substances such as alcohol,...