Jake's View

There’s a dark side to government taxes on sinful indulgences

We now have government trying to take the place of God on the argument that matters of morality are actually matters of maintaining the social fabric

PUBLISHED : Monday, 19 September, 2016, 3:15pm
UPDATED : Monday, 19 September, 2016, 11:00pm

“I know some of you will argue that I am a grumpy old curmudgeon, but if taxes are inevitable, it is surely best to focus them on self-indulgent wants or socially harmful behaviour.”

David Dodwell,

Back to Business,

September 20

Now this really is intolerable. I, Jake, am the official grumpy old curmudgeon in residence at the South China Morning Post. I have worked hard and long for this title and I will not have any anyone take it from me by stealth.

I am also not sure that my colleague David Dodwell is right here in proposing more sin taxes for Hong Kong.

Just for starters, there is a serious imbalance in the ones we have. We tax smoking, the health hazard of the poor, but have abolished taxes on wine, the health hazard of the rich. We tax horse betting, the gamble of the poor, but do not tax derivatives trading, the gamble of the rich. What a sin it is to be poor.

With the steady demise of religion, we now we have government trying to take the place of God

More than this, however, there is the question of where we draw the line. David suggests that no-one needs a Lamborghini. He is right. In fact,I would go further. Driving a Lamborghini is just a noisy, uncomfortable way of proclaiming to the world, “Hey, guys, I’ve got a small one.”

But only Lamborghini? What about Ferrari then and Maserati, just to name the Italian brands of that class of car? Why not cast the net a little wider if we must have sin taxes and tax the German equivalent, Porsche, as well?

And if Porsche, it is only a small step to asking whether anyone really needs a fancy Mercedes Benz. If the purpose of a car is to get safely from A to B in comfort and convenience and everything more rates as the sin of self-indulgent wants, shouldn’t a bottom-of-the-list Toyota be the only car available?

But stop. While this might be true for a fancy Mercedes Benz, what about a plain one? I have a 1.6 litre Mercedes B200 and it’s just a roomy family box on wheels. Where do we draw the line between a sinful and a non-sinful Mercedes?

There are no simple answers to such questions. Once you start imposing sin taxes you enter the quicksands of what precisely (it must be precise once you impose taxes) society should deem to be sin and what not. There is no path through these sands. You will inevitably sink in them.

It is just as bad when we take the opposite tack and grant virtue subsidies. Tesla cars are exempted from the first registration tax. Being all electric, they are deemed environmentally friendly.

This ignores the environmentally unfriendly process of manufacturing them, the environmental horrors of the rare earth mining for their lithium batteries and the fact that their supposed clean power comes in the end from dirty coal at the power plant. With virtue as with sin, where do we draw the line?

Most of all, however, what business is it of government to dictate the morality of citizens? Government’s concern lies with crime, behaviour that seriously endangers the fabric of society.

Sin, however, is the province of God. Very bad as some things may be, if others suffer no harm the only legitimate redress for those who feel offended is to take their complaints to the very top. If you think your workmates should not waste their money on diamond jewellery then get on your knees and tell God about it.

With the steady demise of religion, however, we now we have government trying to take the place of God on the argument that matters of morality are actually matters of maintaining the social fabric.

But even if it were true, it still means that we have some people presuming to give other people detailed orders on how to live their lives without any proven claim to greater wisdom and when the historical record of restrictions on liberty is almost universally a sad one.

Taxes are a means by which government raises revenue to fund its operations. This is all they should be. Render unto Caesar the things that are Caesar’s and unto God the things that are God’s.