Answer to Question #298213 in Microeconomics for Mally

Question

The government has policy objective of changing the consumption behavior of citizens by taxing food?

Answer 1

Public health taxes are excise taxes levied on the potentially dangerous items for one's health such as sugar-sweetened beverages (SSBs), cigarettes, and alcohol, with the goal of reducing consumption, raising money, and/or improving population health. The use of these taxes has been shown to have a considerable impact on purchasing behavior and societal well-being while remaining financially viable. These taxation can be negative in terms of finances for low-income people, but positive in terms of nutrition and health advantages. Tax revenues can be utilized for various health promotion measures, such as retail, industrial, or agricultural incentives to lower the price of healthier food goods.