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and 18.1 percent smoke. Smoking alone is responsible for 27.9 percent of all 
cancer deaths in the Commonwealth and accounts for $6.38 billion in 
health-care costs each year ($2.07 billion of which comes from publicly 
funded Medicaid). A single program, Medicaid, accounts for 37 percent of 
Pennsylvania’s budget. The quality of life for millions of Pennsylvanians is 
compromised by bad health. Resources that could be devoted to education 
or income tax cuts are being diverted to address poor health.

Policy makers have the ability to address health concerns by increasing 
taxes on products that promote our increasingly unhealthy lifestyles. So 
called “sin taxes” are placed on items such as cigarettes and alcohol to raise 
prices and thus discourage their consumption. These taxes should be ex-
panded beyond the traditional products to increase the costs of unhealthy 
behaviors. For example, Philadelphia began collecting a tax on “sugary 
drinks” in 2017. The objective was to nudge people to drink noncaloric bev-
erages in an effort to combat obesity. Pennsylvania could expand the use of 
sin taxes to a wide range of food products that promote bad health. This 
would have the twofold benefit of discouraging poor eating choices while at 
the same time raising revenue that could be used for public health programs 
promoting healthy consumption habits and exercise. This win-win situation 
would positively affect the lives of Pennsylvanians while at the same time 
cutting back on the amount the Commonwealth spends on health-care ser-
vices.

NO

Two of the most popular sandwiches in Pennsylvania are the Pitts-burger 
and Cheese from Primanti Bros. in Pittsburgh and a cheesesteak from Pat’s 
King of Steaks in Philadelphia. If your mouth is watering at the thought of 
these two culinary delights, take note of these statistics: the Pitts-burger 
contains 775 calories (39 percent of the recommended daily intake) and 
51 percent of the recommended daily allotment of fat. A cheesesteak has 
about the same amount of calories but 59.6 grams of fat—a whopping 92 
percent of the recommended daily intake. No one would argue that eating 
these sandwiches on a daily basis is a good idea. However, if people occasion-
ally stop to grab one on the way home from a Phillies or Pirates game, who 
has the right to discourage them? What we eat is a matter of preference, and 
we each suffer the consequences of our dietary choices.

YES

The health of Americans is a serious public policy concern. In Pennsylvania 
30.2 percent of residents are obese, 17.7 percent engage in excessive drinking, 

Commonwealth Forum: Should Pennsylvania Rely  

on Sin Taxes for Revenue?



For example, Philadelphia taxes “sugary drinks.” A twenty-ounce bottled 
Coke from a convenience store gets taxed, but a White Chocolate Mocha 
with whole milk from Starbucks does not. This is true even though the latter, 
with 580 calories, 67 grams of sugar, and 85 percent of the daily recom-
mended amount of saturated fat, is worse for you than a Coke’s 240 calories, 
65 grams of sugar, and 0 percent saturated fat. Second, sin taxes are often less 
about changing behavior and more about finding easy sources of revenue by 
taxing products that are deemed to be against the public interest. It is always 
easier to bridge budget gaps by taxing cigarettes than it is to raise income 
taxes. At the end of the day, sin taxes are just a way for the government to tell 
us what it thinks is good for us rather than letting us make our own deci-
sions. They are a bad idea.

For More Information
The Fiscal Survey of the States (https:// www .nasbo .org/ reports -data/ fiscal 

-survey -of -states) is published in the spring and fall by the National As-
sociation of State Budget Officers. The survey contains data on tax in-
creases in the states, with specific sections on sin taxes levied on prod-
ucts such as alcohol and tobacco.

“Do ‘Sin Taxes’ Really Change Consumer Behavior?” (February 10, 2017) 
is a podcast featuring University of Pennsylvania Professor Benjamin 
Lockwood discussing his research on the economics of sin taxes. Visit 
http:// knowledge .wharton .upenn .edu/ article/ do -sin -taxes -really -change 
-consumer -behavior for a transcript and audio of the podcast.

The Tax Foundation (https:// taxfoundation .org/ state -tax/ excise -taxes/) pro-
vides original research on excise taxes in the states from a small-govern 
ment perspective. Many of its pieces are devoted to studying the effects 
of sin taxes.

“The Pros and Cons of Taxing Sweetened Beverages Based on Sugar Con-
tent” (http:// www .taxpolicycenter .org/ sites/ default/ files/ publication/ 
136861/ pros _and _cons _of _taxing _sweetened _beverages _based _on 
_sugar _content .pdf) was funded by the American Heart Association and 
written by scholars at the Urban Institute. The 2016 study examines the 
feasibility and desirability of collecting beverage taxes at the national, 
state, and local levels.

Not so fast. There’s a group of people who believe they know what’s best 
for us and want to change our consumption habits. They want to levy “sin 
taxes” on products they think people should avoid. It started with cigarette 
and alcohol taxes and has moved on to the current fight over taxes on soda. 
There are two major problems with the expansion of these taxes. First, the 
process for determining which product is subject to extra taxes is arbitrary. 

From Pennsylvania Politics and Policy: A Commonwealth Reader, Volume 1. Edited 
by Michelle J. Atherton and J. Wesley Leckrone (Philadelphia, Temple University 
Press, 2018).




