Wednesday, September 8, 2010

From Russia, With Smokes

Wall Street Journal
September 7, 2010

Russian Finance Minister Alexei Kudrin has alighted on a bright new idea to balance the nation's books while improving his countrymen's overall health: "If you smoke a pack of cigarettes, that means you are giving more to help solve social problems such as boosting demographics, developing other social services and upholding birth rates," he said last week. "People should understand: Those who drink, those who smoke are doing more to help the state."

Mr. Kudrin was referring to a government decision from June to more than double the excise taxes on cigarettes and booze by 2013. The idea of a sin tax is hardly new: Governments the world over spin such taxes as a way of raising revenue and improving health at the same time. But Mr. Kudrin is, as far as we know, the first finance minister honest enough to admit that the only way for the government to raise the desired revenue is for the people to continue to partake of the proscribed (or more expensive) fruit. You can't have one without the other.


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