The Fat tax!Should we punish individual freedom?

If you haven’t heard yet Denmark started the world’s first so called “fat tax”. Read up on it here . From a business point of view, this is a crippling approach, since the extra cost could mean it would be more profitable to produce in another country and import it back to Denmark. Even though the ERM II mechanism is present, there is still a conversion cost which makes the tax more viable. But if Denmark does eventually adopt the Euro, it would probably not be sustainable any longer(though perhaps by that time there will be further integration which will negate any loss in one countries trade deficit).

But the more interesting part is… does it make sense on a moral perspective? Depends on your point of view really… are you the kind of person who waits for his friends? or would you leave them behind if they slow you down? Assume the first option, how different is a “friend” from someone unknown to you, someone from the same country? I for instance don’t have much sense of nationalism and i don’t feel particularly closer to any one from my country of origin. So no i would not want to pay extra in taxes to accommodate health care just so someone will else can exercise their freedom to eat, the fact is, their freedom is weighing down on my wallet, and with less money, i have less options, and consequently my own individual freedom is  constrained.

I am not more sympathetic to someone with a choice to do something than i am to someone who has not, like a poverty stricken child just because the latter is not born or inhabiting the same km squared land(measured not even by proximity to my home, i might be living closer to another nationality than this person).

In fact you gotta punish the reckless behavior in some way, even if this is not the right way, it represents a new framework for thinking about how to stop this projection, half the US population will be obese by 2030. That’s 65 million more obese people in the US, additionally there will be 11 million more in Britain.

Being fat isn’t cheap either, although its not a very conclusive econometric study, this one, absenteeism could be costing about 1% of US GDP per year. If this effect were true, it would be much smaller in Denmark and Britain, but perhaps its much more appropriate for Denmark to apply it because poverty isn’t nearly as big a problem there(though GNI per capita is higher in the US, inequality is too, which leaves more people with less flexibility in their choices).

Using weight to adjust prices isn’t a new thing, we probably already have the infrastructure to do it, though only the ballsy RyanAir dared do this before by having weight based fees. In any case here’s a link arguing that its dystopian if your interested in reading more.

So whats the final note? well for me Taxing those who are going to use a higher proportion of healthcare makes sense. But the method employed is not very efficient because it creates this import advantage. Using guidelines which you can find here, its easy to just tax fat people directly. Taxing fat people directly for being fat is more efficient than taxing their food since if someone can get away with eating fatty foods(by keeping a balanced lifestyle, or winning the genetic lottery) why should they be punished? Of course people who are genetically fat, would be exempt again… they never had a choice.


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