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Friday 05 July 2019 4:00 am  |  Updated:  Thursday 04 July 2019 5:50 pm

Boris is right to question the nanny-state impulse to tax our milkshakes

By: Kate Andrews

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The milkshake, once defined as tasting of watered-down ice cream, can now be defined as the taste of freedom.

Targeted as the next treat to have an arbitrary sin tax slapped on it, the milkshake and its consumers have just found a new ally. This week, Conservative leadership hopeful Boris Johnson reiterated in a press release that he would oppose the milkshake tax, noting that he didn’t think it would be effective.

More importantly, he called for halting the roll-out of all sin taxes, until it could “be clearly demonstrated that such taxes actually make a real difference to people’s behaviour and don’t unduly penalise the lowest paid”.

If Johnson is serious about basing tax policy on clear evidence, fans of freedom should be relatively optimistic that sin taxes will be on pause indefinitely. 

The empirical evidence overwhelmingly suggests that the poorest in society are disproportionally affected by these taxes. 

With the exception of air passenger duty, all sin taxes take a greater share of income from the poor than from the rich. In some cases, poorer households can be paying up to 10 times more in sin taxes than richer households as a share of their income.

And while these taxes are clearly regressive by nature, some also fail in their objective to change behaviour. Case studies from around the world have neglected to show that a sugary drinks tax helps to reduce overall calorie intake or obesity. 

While Johnson is willing to defend our sugary drinks and milky ice cream, he has stopped short of rolling back the original sin taxes on alcohol and tobacco. Possibly, he feels that is a step too far, but equally likely is that he understands the financial black hole it would create for the Treasury to reduce the tax burden on smokers and drinkers.

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Despite supporters of sin taxes claiming that higher prices encourage users to “improve” their behaviour, many people continue to smoke and drink, and those that do pay their way when it comes to funding public services. 

This suggests, perhaps, that some policymakers recognise the taxes don’t work, but still support the increased tax take. 

In the last fiscal year, the UK government brought in over £11.4bn in alcohol duty receipts. When bundled together, IEA research shows that the taxes more than cover the costs that smoking and drinking impose on public finances, and are estimated to provide a net saving to the government of £22.8bn in 2017.

Excessive drinking and smoking is unhealthy and often dangerous behaviour, but the vilification of adults choosing to take up such lifestyles is itself another form of harm, especially when you consider that their tax money is topping up health resources, not depleting them.

Whether it be a slash to sin taxes, a change in rhetoric, or a simple acknowledgement that both children and adults can see an advert for strawberries and cream on the tube without the world coming to an end, it’s time for a shake-up of this government’s nannying mentality. 

Perhaps it’s begun. Maybe the shake-up starts with the milkshake.

Main image credit: Getty

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Even Zack Polanski’s favourite economist admits wealth taxes don’t work

Zack Polanski speaking at a conference podium, addressing a crowd with a focused expression, wearing a formal suit.

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