One point that I did not address in the blog posting on certain temporary tax hikes on junk food and soda taxes is the complexity issue. Here are a few excerpted paragraphs outlining the possible administrative nightmare that such taxes would unleash:
Soda and so-called “junk food” taxes are also highly regressive. Worse, they would create an administrative nightmare. After all, potato chips might be a junk food, but are the slightly healthier Sun Chips? How about the fat-free potato chips that have come on the market in recent years? Things can get really complicated and unfair.
Soda taxes also face the same fairness and administrative issues. After all, Gatorade and other sports drinks have a lot of calories and lemonade, orange juice, and chocolate milk actually have more calories for each cup than does regular Coke. Diet sodas on the other hand have zero calories. Which of these items will be taxed? More importantly, once the lobbying heats up and the various interests attempt to exempt their products from taxation, who will answer these questions and how much will it cost to fund a bureaucracy to do this?
According to Governor Richardson’s State of the State address, he’s opposing re-instatement of the grocery tax, so I believe that these narrowly targeted taxes will indeed be the primary targets for Richardson’s “revenue-raisers.”