- more fly tipping
- more garden fires
- more rats... and not just in government
All taxes have behavioural consequences: people don't like paying tax, and will go to great lengths to avoid doing so. We all know that: only nanny seems to sail on regardless.
Tobacco taxation is a salutary example. As the Chairman of BAT has just reminded us, punitive taxation of the foul weed has fostered a multi-billion global industry devoted to smuggling and counterfeiting. He estimates that it costs lawful tobacco companies £2bn pa, and taxpayers £12bn pa in lost revenue.
As we blogged here, HMRC estimates it costs British taxpayers about £3bn pa- nearly 1p on the standard rate of income tax- and others reckon the figure is even higher. Plus, it has unknown health consequences because many of the smuggled ciggies are forgeries made from camel dung.
Camel dung will be the least of problems once the bin tax gets going.