“Fat tax” is a recipe for unfairness

Christopher Pang

Fat tax, Slim hope

When this news of an ongoing consideration of a “fat tax” was announced, it sounded like a joke in a stand up routine. But it seems like the British Prime Minister, David Cameron, is seriously considering an obesity tax similar to the one implemented in Denmark whereby a surcharge is imposed on food with higher level of saturated fats.

What is a fat tax?

A fat tax is a surcharge placed upon fattening foods, beverages or individuals, with the objective of discouraging unhealthy diets and offset economic costs of obesity. There have been studies suggesting a high correlation between eating behavior and price as compared to nutrition education. However there are also contrasting evidence that obese individuals are less responsive to changes in price of food than normal-weight individuals. Figures also show obesity levels are far higher in poorer homes, areas of high unemployment, poor education and bad housing.

Libertarian view

Many people might think the government is implementing this tax for “our own good”. However, should the state be using taxes as deterrence on society to not drink soft drink, eat Kentucky Fried Chicken or measuring our waistline annually to tax us? Some might argue the government is not stopping us from consuming such foods/drinks but only shaping our consumption patterns through taxation. The question is “Should the government be allowed to in the first place?”

If the government is allowed to implement a tax for “our own good”, what is there to stop it in the future that they will implement a tax on heavy metal music which they find damaging to the eardrums, or escalator/lift tax because walking up the stairs is a healthier option? Would Cameron then consider taxing people who do not run 3 times a week? As absurd as these ideas might sound, it might be implemented one day if we continue to let our government micromanage us for “our own good”.

A fat tax is regressive because low income households are more likely than wealthy households to eat fatty fast food and have less access to fresh and healthy food. A fat tax hits the poor harder than the rich. In a simple hypothetical example, junk food which cost $6 a meal now cost $8 a meal after tax and cost of healthy salad cost $10. It would still be more economical for a poor fellow to indulge in junk food as it gives him more calories per dollar spent. The higher calorie intake would enable him to last the entire day of work. If his pay was $4 per hour, he would have to work an hour more each day to pay for tax difference for both lunch and dinner or be $4 worse off. This 1 hour of sacrifice could be from exercising or could be from his social time. The poor man is still consuming the same junk but with one hour lesser of leisure time every day, making him worse off than before, and possibly increasing likelihood of obesity.

Root cause of the problem

How should the problem of obesity be tackled then? It seemed at first glance that obesity is the root cause to the rising healthcare costs. However the root cause of this problem is socializing healthcare in the first place, which results in an individual’s irresponsible choices. As the cost of one individual’s decision on consumption falls upon the society with medicinal socialism, the individual will not feel the penalties of his value judgments as the cost is fixed for everyone whether he behaves appropriately or not. Individuals should be responsible for their own choices. The poor man who consume junk in the short term without considering the long term consequences should bear the responsibility of his own health deteriorating and eventually his medical bills. His irresponsibility should not be society’s responsibility.

Governments may call this a “fat tax” but it is in reality another government scheme to take more money out of the hard pressed taxpayers. What we choose to eat is not the government’s business. The primary objective of setting up a government in the earlier years was to defend our individual rights and civil liberties but ironically today our governments are the biggest entities that oppress our rights and civil liberties.

Photo courtesy of the TheHuffingtonPost.com