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comment by rozap
rozap  ·  4141 days ago  ·  link  ·    ·  parent  ·  post: Legal Pot Is Here, But Stash The Wallet For Now : NPR

No, it shouldn't. Right now the massive risk associated with growing drives up prices. Once that risk is gone, prices will fall (if it were untaxed). Taxes should then be added to a point where supply/demand reaches an equilibrium and therefore revenue is maximized. And, I would suspect, this will still be less than it is now.

Taxes shouldn't be added willy nilly. They should be carefully calculated to maximize revenue, taking into account the market's response to pricing.





user-inactivated  ·  4141 days ago  ·  link  ·  

That's now how equilibrium and taxes work, unfortunately. Taxes by their nature interfere with maximization of producer and consumer revenue, because that's not what the government cares about. With marijuana, an additional effect will come into play because the government will probably stick it with an extremely high "sin tax." This is all speculation at the moment but we'll know more next year.

rozap  ·  4140 days ago  ·  link  ·  

You're right, they do work like that. But they shouldn't, and they don't have to.

If the government wants to maximize its tax revenue, then that makes a lot of sense. What doesn't make a lot of sense is the government telling me what is a sin and what isn't, when my "sinning" only has an effect on me.

user-inactivated  ·  4139 days ago  ·  link  ·  

    What doesn't make a lot of sense is the government telling me what is a sin and what isn't, when my "sinning" only has an effect on me.

This is the extreme libertarian point of view, and of course in many cases is dead wrong. For instance, the phrase sin tax was essentially coined with regard to cigarettes -- and smoking cigarettes in public has been proven multiple times to have massive negative health effects on other people.

This is not to say that the libertarian POV is always wrong, or that smoking a cig always hurts others, but just to point out that libertarians can often be tempted to apply absolutes to situations that don't call for them.