Why Levy Discriminatory Excises on Soft Drinks?
Bahl, Roy, 1998. Why Levy Discriminatory Excises on Soft Drinks?, International Studies Program, School of Policy Studies, Georgia State University, Working Paper 98.3, 1998
This review investigates why discriminatory excise taxes in more advanced economies, focusing particularly on the EU, do not work in modern tax systems. Some key insights from the review:
- “[…] the economic case for taxing soft drinks is weak. […] A middle or higher income country that resorts to a tax list of discriminatory excises on consumption of specified products is taking a step back in the development of their fiscal system and is postponing a more proper reform that would be in the better interest of the country”
- “The case for a discriminatory tax on soft drinks is very weak. At best the discriminatory taxation of soft drinks is part of a “stopgap” program, usually designed to solve a short-term revenue problem”
You can find the whole paper here.