Tax Proposals Research Articles

Taxing animal-based food products: A qualitative framing analysis of the media debate in Germany

Abstract Background In most high-income countries, consumption of animal-based food products exceeds levels recommended for health and environmental reasons. Although taxes can reduce the consumption of animal-based products, they are politically controversial. In recent years, various tax models and motivations for these have been discussed. Our study seeks to identify key arguments and policy actors in the German media debate on the taxation of animal-based products, shedding light on emerging narrative frames surrounding tax models and motivations. Methods We conducted a qualitative analysis of German media coverage on taxes and levies influencing the price of animal-based foods. We analyzed 488 articles from 10 national newspapers and eight trade press journals published between February 2019 and July 2023. Employing an inductive approach, we identified the actors involved in the debate and common frames and arguments around various tax proposals. Results We found broad consensus on a need for change due to inadequate animal welfare conditions, while environmental and health arguments are more contested. Significant debate surrounds the suitability of taxation as the preferred policy instrument. Furthermore, doubts are raised about a tax’s effectiveness and appropriate revenue allocation. Framing of the tax often emphasizes potential negative impacts on domestic production and product affordability. Additionally, concerns about various unintended consequences and the overall unpopularity of taxation emerge as prominent themes. Conclusions The taxation of animal-based products for health and environmental reasons is still highly contested in the media debate in Germany. Many, but not all arguments commonly raised against such taxes may be considered spurious from an evidence-based public health perspective. Proponents of such taxes may seek to address existing concerns through appropriate policy design and communication strategies. Key messages • Taxation of animal-based foods may help to align consumption with levels recommended for health and environmental reasons, but adoption and implementation is hindered by political controversy. • Objections common in the public debate on such taxes could be addressed with appropriate policy design alleviating justified concerns, and with communication strategies countering spurious arguments.

A Higher Power in Higher Education: An Exploration of Endowment Taxes, the Establishment Clause, and College Affordability

Institutions of higher education in the United States have enjoyed a broad tax exemption for hundreds of years. In 2017, however, Congress imposed an excise tax on certain colleges’ and universities’ endowment revenue as part of the Tax Cuts and Jobs Act (Act). The endowment excise tax is not scheduled to sunset in 2025 alongside other provisions of the Act, but members of Congress have begun to revisit the issue of whether and how to tax the nation’s educational institutions. This Note examines two endowment tax proposals’ attempts to exempt religious colleges and universities from heightened endowment excise taxes. It argues that although taxing college and university endowments is a possible legislative tool for making higher education more affordable for more Americans, exempting religious schools from such taxes both runs counter to this goal and violates the Establishment Clause of the U.S. Constitution. If Congress chooses to expand college and university taxation, it should do so in a way that effectively addresses the college affordability crisis and treats religious and secular institutions alike.

Limiting support for environmental policies: Unfairness is a more critical barrier than cost and ineffectiveness.

Costs and policy-specific beliefs, such as effectiveness and fairness, are central factors for supporting environmental taxes. Less is known about how much each of these factors is limiting support. Across four experiments, I investigate to which extent high costs, ineffectiveness, and unfairness constrain support for environmental taxes. Results consistently demonstrate that perceived unfairness poses a greater barrier to support than extensive costs or ineffectiveness. These findings were robust across three environmental taxes (meat tax, plastic tax, and carbon tax), across three cultures (USA, UK, and India), and were replicated using a representative US sample. Furthermore, delving deeper into the consequences of perceived unfairness, results showed that distributional unfairness was a stronger barrier to support than procedural unfairness. Beyond limiting support, being presented with an unfair tax proposal led participants to perceive the tax as less effective and to express lower trust in policymakers than when receiving a fairer tax proposal.

Food Tax Substitution Effects

Diet-related illness in the U.S. has risen to crisis levels, with today’s parents projected—for the first time—to enjoy longer lives than their children. Policymakers have responded with a range of novel proposals, many revolving around the assumption that increasing the relative price of unhealthful foods via taxes on soda, fat, sugar or caloric density will encourage more healthful eating. Yet there is little evidence that diet-targeted price interventions have had a meaningful impact on health outcomes. The reason for this, I argue, is both expected and largely overlooked in the academic and policy literatures: consumers have been motivated by price interventions to eat differently, but differently isn’t necessarily better. Price interventions created and crafted solely on the basis of the nutritional value of the targeted dietary item(s) are vulnerable to health-neutral substitution effects, wherein a price intervention motivates consumers to substitute items of similar dietary value—candy or beer for soda, for example—leading to little net change in overall dietary quality. This Article proposes a novel food tax strategy, one that focuses on substitution effects. Instead of targeting foods with the least or most nutritional value, legislators and other policymakers should direct taxes to foods with the least or most relatively healthful substitutes. As proof of concept, this Article introduces a specific substitution-based food tax proposal, supported with empirical results from an original randomized controlled trial: food taxes should seek to motivate substitution between grocery food and the relatively less healthful option of restaurant food. The health impact of such a shift will likely exceed that of a direct tax on soda, fat, sugar or calories given the high cross-elasticity of demand for restaurant food and its significant health inferiority. And because this shift may be accomplished by subsidizing groceries, by lowering taxes on groceries or by increasing taxes on restaurants, it presents a more politically flexible intervention than traditional consumer-side food taxes.

Taxation Models and Improvement Proposals for Personal Income Tax in the Sharing Economy

As an innovative economic model, the sharing economy has seen rapid growth globally in recent years. It has not only brought a profound impact on traditional economies but also injected new vitality and momentum into the sustainable development of the social economy. However, for the sharing economy, the process of collecting personal income tax is facing several issues, such as the ambiguity of tax policies regarding personal income, challenges in identifying taxpayers, and difficulties in defining income. To achieve the fairness and efficiency of personal income tax collection in the sharing economy, this study proposes optimized regulatory mechanisms and conducts in-depth discussions on the adjustment of personal income tax policies, innovation in tax management technology, and improvement in the quality of personal income tax services.

Labour supply responses to a negative income tax in Spain

One of the major drawbacks of a Basic Income proposal is that it could induce people to reduce their labour supply. The main aim of this paper is to put forward a financially viable alternative to the current Spanish system of social protection, based on a Negative Income Tax proposal and introducing several changes in the social protection system. Using EUROMOD, the labour behavioural responses to these new conditions are studied in detail, using a structural model of labour supply.The main result is that a reform as the one described in this work will not make people to abandon the labour market, as usually argued for Basic Income proposals. Under this scheme, on the contrary, we can observe a slightly increase in labour supply. This finding has strong implications for policy. Modifying the tax-benefit system, bringing it closer to a Basic Income scheme, will produce significant improvements in inequality and poverty without a significant change in labour supply.

Subsidies or green taxes? Evaluating the distributional effects of housing renovation policies among Dutch households

Despite persistent housing affordability issues, energy policy and housing renovation are usually investigated separately from housing costs other than energy. Researchers have examined the financial viability of renovation attending to building conditions and the socio-economic characteristics of their occupants. However, the distributional impacts of renovation incentives and the potential of fiscal policy to redistribute housing costs remain understudied. Dutch fiscal policy, favouring homeownership, offers a relevant context to evaluate how property taxation can boost renovation rates. The novelty of this paper resides in investigating the impact of two policies, the current direct subsidy and a proposal for a green tax, on both the financial viability of renovation and the subsequent distribution of housing costs. The proposed green tax combines energy efficiency and taxation of property revenue. We employ a model considering marginal costs of housing renovation, obtained from a government dataset, and marginal benefits, drawn from a hedonic regression. We assess the distributional impacts of different policy scenarios by examining changes in user costs across income deciles. Our findings indicate that existing renovation subsidies exacerbate the regressive distributional impacts resulting from the current housing taxation system in the Netherlands. Introducing energy-efficiency-linked property taxation can make homeownership fiscality less regressive while incentivising housing renovation. Ultimately, this study highlights the importance of incorporating housing affordability as a fundamental element in renovation policies to balance environmental and distributional objectives.

Election-day market reactions to tax proposals: Evidence from a close vote

We ask whether stock markets react to political leaders' intentions to tax shareholders immediately following their election. Our natural laboratory is the surprising outcome of the September 2021 Japanese Prime Ministerial election. Using an event study approach, we find firms that are vulnerable to a potential tax increase, such as those paying or receiving dividends, demonstrate lower stock returns compared to their counterparts. In contrast, our analysis does not show differences in stock returns between firms earning interest income and those that do not. Moreover, among high dividend yield firms, a striking contrast emerges: those with substantial individual ownership show a decline in stock returns, while those with significant foreign ownership exhibit an increase. These results highlight the targeted impact of shareholder taxation on domestic shareholders, distinguishing them from debt holders or foreign investors, right from Election Day.

Sugar tax and product reformulation proposals reduce the perceived legitimacy of health-promotion institutions: a randomized population-based survey experiment.

Structural nutrition interventions like a sugar tax or a product reformulation are strongly supported among the public health community but may cause a considerable backlash (e.g. inspiring aversion to institutions initiating the interventions among citizens). Such a backlash potentially undermines future health-promotion strategies. This study aims to uncover whether such backlash exists. We fielded a pre-registered randomized, population-based survey experiment among adults from the Longitudinal Internet Studies for the Social Sciences panel (n = 1765; based on a random sampling of the Dutch population register). Participants were randomly allocated to the control condition (brief facts about health-information provision/nudging), or one of two experimental groups (the same facts, expanded with either a proposed sugar tax on or reformulation of sugar-sweetened beverages). Ordinary least squares regression was used to estimate the proposed interventions' effects on four outcome variables: trust in health-promotion institutions involved; perceptions that these institutions have citizens' well-being in mind (i.e. benevolence); perceptions that these institutions' perspectives are similar to those of citizens (i.e. alignment of perspectives); and attitudes toward nutrition information. Trust, perceived benevolence and perceived alignment of perspectives were affected negatively by a proposed sugar tax (-0.24, 95% CI -0.38 to -0.10; -0.15, -0.29 to -0.01; -0.15, -0.30 to 0.00) or product reformulation (-0.32, -0.46 to -0.18; -0.24, -0.37 to -0.11; -0.18, 0.33 to -0.03), particularly among the non-tertiary educated respondents. Sugar taxes or product reformulations may delegitimize health-promotion institutions, potentially causing public distancing from or opposition to these bodies. This may be exploited by political and commercial parties to undermine official institutions. https://osf.io/qr9jy/?view_only=5e2e875a1fc348f3b28115b7a3fdfd90. Registered 3 February 2022.

Digital Tax Regulation in Facing Society 5.0 Era to Realize Indonesian Tax Sovereignty

Technological advancements have catalyzed the emergence of the digital economy, where digital platforms, leveraging internet access, can penetrate multiple regions and accrue substantial profits unrestricted by national jurisdictions. This scenario presents advantages and convenience but simultaneously challenges a country's tax sovereignty. The traditional tax system, predicated on a company's physical presence for tax liability, finds itself ill-equipped to handle the digital domain's nuances. This research seeks to explore the potential and hurdles in implementing digital taxes in Indonesia, delving into the government's regulatory efforts within the framework of Society 5.0. From an academic standpoint, digital taxes illustrate the disruption in tax collection due to the absence of a tangible company presence. Thus, this study also aims to investigate the determination of tax sovereignty in the context of digital taxation, aspiring to enrich scholarly discourse. Employing a normative juridical approach, this study scrutinizes legal norms and rules while considering empirical facts from the field. The findings indicate that while the introduction of digital taxes in Indonesia holds significant promise and faces considerable challenges, governmental action to update and streamline digital tax regulations is imperative. Furthermore, the principles underlying digital tax proposals, such as Pillar One, require reinforcement to enhance their effective implementation.

Tax Certainty in the Digital Economy in the Perspective of a Two-Pillar Program

The rapid development of the digital economy has brought new challenges to global tax administration, and traditional tax systems are facing numerous difficulties. As an important part of global tax reform, the "two-pillar solution" is of great significance in addressing tax issues in the digital economy. This paper first provides a brief overview of the two-pillar solution and its main contents. It then examines the issue of tax certainty in the digital economy, analyzes the importance of tax certainty for the digital economy, and the challenges it faces. Subsequently, policy recommendations are presented to address tax certainty issues in the digital economy, including international cooperation and coordination, improving tax data collection and information exchange, and promoting self-regulation and compliance in the digital economy. Finally, by analyzing the example of the EU digital tax proposal and the progress and implementation of international tax reform, the paper summarizes the importance of tax certainty in the digital economy, the prospects and challenges of the two-pillar solution, policy recommendations, and future prospects. This paper aims to provide ideas and references for researching tax issues in the digital economy and its solutions, in order to promote the reform and upgrading of the global tax system.

Common Sense of a Wealth Tax

Thomas Paine’s writing helped spur the American colonies to independence and ensure that the new nation would be a republic, not a monarchy. In light of the renewed interest in wealth taxes, this article provides a close examination of Thomas Paine’s wealth tax proposal in the second volume of The Rights of Man. Unlike Paine’s proposal to tax inheritances, his 1792 proposal to tax wealth on an annual basis is often overlooked. The article identifies Paine’s various design specifications, provides original estimates of the impact of Paine’s wealth tax proposal within his own time period and as applied to billionaires today, and discusses ambiguities in the proposal. The article then places Paine in conversation with the contemporary wealth tax policy debate and demonstrates how Paine informs both the design and evaluation of tax policy. Lastly, the article clarifies the relationship between democratic ideals and taxation, portraying tax policy as a normative expression of republican ideals.

Pro- and Anti-Tax Framing in News Articles About California Sugar-Sweetened Beverage Tax Campaigns from 2014-2018

Sugar-sweetened beverages (SSB) contribute to illness, especially among marginalized communities and children targeted by the beverage industry. SSB taxes can reduce consumption, illness burden, and health inequities, while generating revenue for health programs, and as one way to hold the industry responsible for their harmful products and marketing malpractices. Supporters and opponents have debated SSB tax proposals in news coverage – a key source of information that helps to shape public policy debates. To learn how four successful California-based SSB tax campaigns were covered in the news, we conducted a content analysis, comparing how SSB taxes were portrayed. We found that pro-tax arguments frequently reported data to expose the beverage industry’s outsized campaign spending and emphasize the health harms of SSBs, often from health professionals. However, pro-tax arguments rarely described the benefits of SSB taxes, or how they can act as a tool for industry accountability. By contrast, anti-tax arguments overtly appealed to values and promoted misinformation, often from representatives from industry-funded front groups. As experts recommend additional SSB tax proposals, and as the industry mounts legislative counter-tactics to prevent them, advocates should consider harnessing community representatives as messengers and values-based messages to highlight the benefits of SSB taxes.

The Implications of Pillar Two for Corporate Tax Reform

Recent proposals for corporate tax reform in Canada call for changing the existing tax on shareholder income to a tax on rents or above-normal profits. A feasible option would be an allowance for corporate equity (ACE) system based on the territorial principle. Canada has agreed to the approach to international corporate tax reform developed by the Organisation for Economic Co-operation and Development, including the pillar two minimum tax proposal. We explore the compatibility of adopting pillar two with the ACE system. Several elements of pillar two would complement moving to an ACE system. Large multinational corporations would be liable for a top-up tax if their effective tax rates in any given jurisdiction fell below 15 percent. The effective tax rates and the top-up tax would both use the territorial approach and consolidated accounting. The top-up tax would be similar to a tax on excess profits. Pillar two might also mitigate tax competition and reduce the constraints that countries face in increasing their tax rates on excess profits. For these reasons, pillar two would facilitate moving to an ACE system. At the same time, the minimum tax would deter adoption of an ACE if the deduction for the cost of equity finance reduced the pillar two effective tax rate. On balance, pillar two would be compatible with proposed corporate tax reforms.

Hazardous Chemical Tax Proposal on Clothing and Footwear: Evidence From Sweden

Tehlikeli kimyasal maddeler, çevre ve insan sağlığı için yüksek risk oluşturur. İnsan yaşamının her alanında yer alan ürünlerden olan giyim ve ayakkabılarda kullanılan tehlikeli kimyasallar ise, cilde zarar vermekte; tekstil liflerinden salınan tozun cilt teması, solunması veya istenmeden yutulması yoluyla tüketiciler tarafından çeşitli sağlık sorunları ile karşı karşıya kalınmaktadır. Dünya pazarı ve küresel ticaret sistemi içerisinde önemli bir paya sahip olan hazır giyim ve tekstil endüstrisi, artık teknolojik gelişmeler sayesinde ekonomik koşullara bağlı olarak kapsamlı bir dönüşüm süreci içine girmiş, tehlikeli kimyasal maddelerin kullanılmaması veya kısıtlanması yönünde birçok tedbir almaya başlayarak çeşitli yöntemler denemiştir. Bu kapsamda bir taraftan Avrupa Birliği REACH Tüzüğü, CLP Tüzüğü, Avrupa Yeşil Mutabakatı (European Green Deal) gibi birçok hususta düzenleme yaparken; diğer taraftan üye ülkeler kendi mevzuatını bu yönde güncellemeye ve değiştirmeye başlamıştır. Buna göre, Avrupa Birliği, kansere ve üreme sağlığı sorunlarına neden olduğu bilinen kimyasallara karşı tüketicilerinin sağlığını korumada önemli bir adım atmış, bu türden zararlı kimyasalların giyim, tekstil ve ayakkabılarda kullanımını sınırlandırmıştır. Kanserojen, mutajenik veya üreme için toksik olan kimyasal maddelerin, artık günlük giyim, tekstil ve ayakkabılarda belirli bir yoğunluk sınırının üzerinde kullanılamayacağına karar verilmiştir. Avrupa Birliği ülkelerinden İsveç ise “giyim ve ayakkabılar üzerinden alınan tehlikeli kimyasal vergisi” önerisi ile bu hususta yeni bir vergi uygulamasının önünü açmıştır. Söz konusu vergi, giysi ve ayakkabılarda çevreye ve insan sağlığına zararlı maddelere maruz kalma veya yayılma riskini etkin maliyet ile azaltmayı amaçlamaktadır. Gerek Avrupa Birliği gerek İsveç ulusal mevzuat dikkate alınarak hazırlanan bu çalışmada, uygulamaya konulması önerilen verginin hem şirketler ve tüketiciler nezdinde hem de sürdürülebilir çevre anlayışı doğrultusunda etkisi tartışılacaktır.

Do stock exchanges specialize? Evidence from the New Jersey transaction tax proposal

Exchange ownership in the U.S. is often characterized as excessively concentrated. This leads to a concern that such concentration may prevent peripheral exchanges from mitigating adverse selection costs associated with low-latency arbitrage. We examine this concern using low-latency connectivity disruptions caused by temporary relocations of two markets, NYSE Chicago and Nasdaq PSX, in response to a transaction bill proposal. Although both exchanges had previously announced measures to curb low-latency trading, the connectivity disruptions cause a substantial reduction in adverse selection. These results suggest that peripheral markets have little incentive to implement measures restricting low-latency arbitrage.

An exploration of stakeholder views and perceptions on taxing tobacco, alcohol and sugar-sweetened beverages in Ghana

BackgroundNon-communicable diseases (NCDs) account for nearly 43% of Ghana’s all-cause mortality. Unhealthy commodities (such as alcohol, sugar and tobacco) are an important factor in the growing NCD burden in the...

The Instrumental Role of Strategic Communication to Counter Industry Marketing Responses to Sugary Drink Taxes Comment on "Understanding Marketing Responses to a Tax on Sugary Drinks: A Qualitative Interview Study in the United Kingdom, 2019".

Strong sugary drink taxes are effective at reducing sugary drinks consumption. In response, the sugary drinks industry employs various marketing strategies to undermine the taxes to protect and maintain its customer base. In their recent article in this journal, Forde et al present a framework for understanding how sugary drinks companies use marketing for this purpose. In this commentary, we reflect on this framework by drawing from recent experiences of sugary drinks industry marketing responses. Further, we review the global evidence on the instrumental role that strategic communication can play in protecting strong taxes from industry responses. We make a case for strategic communication as a vital tool in promoting and protecting sugary drinks tax proposals, both prior to and after their introduction.

Exergy, ecology and democracy - concepts of a vital society or a proposal for an exergy tax 30 years after - Part 1: Generalities

Goran Wall?s "exergy, ecology, and democracy ? concepts of a vital society or a proposal for an exergy tax? has come a long way since its presentation in 1992. Wall has extended the thermodynamics to the sustainability analysis of economic, environmental and societal models. The authors of this paper aim to discuss Wall?s intuitions in today?s scenario. Governments are assuming increasing measures against climate change and toward sustainability. However, these measures do not affect the concentration of GHG and global heating. It is an evident failure from a thermodynamic point of view. The economic indicators used by governments to measure the progress toward UN. Sustainability development goals and the Paris agreement reveal a scarce consistency. One of the most used is ?domestic material consumption?. It accounts for the mass balance of the materials entering or exiting a national economic system. However, it lacks consistency and delivers insufficient information because it neglects the impacts of import-export. As Wall shows, more effective and consistent indicators are necessary to account for sustainability. The most relevant is exergy, which has been presented and discussed widely.

“Exergy, ecology and democracy - concepts of a vital society or a proposal for an exergy tax” 30 years after - Part 2: Exergy and U.N. sustainable development goals

Thirty years ago, Goran Wall published ?Exergy Ecology Democracy - Concepts of a vital society or a proposal for an exergy tax?. This paper discusses this milestone contribution by Wall. It has traced a path toward economic, environmental and societal sustainability and proposed exergy as a robust indicator for measuring progress. This paper is divided into two parts. The first focuses on better understanding Wall?s role in today?s scenario. This second part presents different methods that allow using exergy to assess the sustainability of economic, industrial and societal processes. First, it presents an example showing the inadequacy of domestic material consumption (DMC) in evaluating the sustainability of import-export operations. Second, how exergy can apply to increase the significance of DMC has been discussed. A new indicator that allows coupling with DMC has been defined to improve the information delivered by DMC and make it a more effective sustainability indicator. Third, some ecological indicators are discussed. The use of exergy to integrate DMC and assess lifecycle and polluting emissions into the environment has been discussed. Finally, an effective exergy tax proposal is presented as an instrument for stimulating an effective transition toward sustainability of consumption and people?s habits.