[jthomas1600]

So, to increase govt. funding for health care (not necessarily related to the current bill) the Obama administration passed a huge tax increase on to the tobacco industry. It looks like the tobacco industry might not pay a cent of that money due to a loophole. I wonder how the loss of projected revenue will effect the administrations plans for health care reform and I wonder how they will respond.

The Facts

[TunerSteve]

I always worry when politicians assume that tax revenue will fund any programs. We found that when gasoline prices shot up, folks quit driving as much, and therefore less tax revenue was collected, and now they scramble to figure out how to fund programs/projects that were already in place.

While the current trend economically calls for everyone to be more frugal, and comes with a measure of pain, overall I believe it's a good thing for our country to re-learn how to live within our means.

[bravesfan007]

Tax the snack food industry next. Then the fast food industry. It's easy to keep passing the burden along to other industries, but eventually it falls on the consumer.

[JerryLove]

Originally Posted by bravesfan007

Tax the snack food industry next. Then the fast food industry. It's easy to keep passing the burden along to other industries, but eventually it falls on the consumer.

Much like if we didn't offer healthcare. The burden would again fall on the consumer.

You almost make it sound like the people who produce all the goods and services must produce all the goods and services.

[bowstaff981]

I think it's kind of a dirtbag move to increase taxes on cigarettes to try and fund things. On one end the Government says "Smoking's bad for you, everyone should stop", but on the other end they're making money off of your habit that they are supposedly trying to convince you to quit.

On another note, anyone seen Thank You for Smoking?

[bravesfan007]

Originally Posted by JerryLove

You almost make it sound like the people who produce all the goods and services must produce all the goods and services.

Huh?

[JerryLove]

Originally Posted by bravesfan007

Huh?

Money = products and services.
Therefore the producers always bear all costs of all things.

[Bryan]

roll-your-own cigarrettes? really? that's what they passed the tax on. In all the years that I smoked I maybe rolled my own smokes for a couple days. I never knew anybody who did it. It's hardly something worth mentioning.

[Jeffrey]

But they're chipping away slowly. They banned flavor cigarettes; due to a loophole/provision, I can still order clove cigarettes direct from Indonesia. But no shops can carry flavored cigarettes; they can carry the less pleasant flavored pseudo-cigars.

Since the major tobacco companies supported these measures, I wonder if this is less the government trying to get people to smoke and more certain government-favored corporations receiving preferential treatment, protected by their lobbyists and governmental contacts from competition.

[tlj009]

Since the major tobacco companies supported these measures, I wonder if this is less the government trying to get people to smoke and more certain government-favored corporations receiving preferential treatment, protected by their lobbyists and governmental contacts from competition.

So is there any good reason that roll your own cigarette tobacco would get a 2,000% increase in taxes and pipe tobacco wouldn't?

[bravesfan007]

Originally Posted by jthomas1600

I wonder how the loss of projected revenue will effect the administrations plans for health care reform and I wonder how they will respond.

Originally Posted by bravesfan007

Tax the snack food industry next. Then the fast food industry. It's easy to keep passing the burden along to other industries, but eventually it falls on the consumer.

Originally Posted by JerryLove

You almost make it sound like the people who produce all the goods and services must produce all the goods and services.

Originally Posted by JerryLove

Money = products and services.
Therefore the producers always bear all costs of all things.

I'm sorry if I'm blind to what you're getting at here, but I don't see it. There was a question posed as to what will happen next and I made my predictions. There has already been talk of a "soda" tax and there are other "taxes" to be levied if need be in order to pay for the health care reform.

Consumers pay the majority of any tax and producers pay very little. If there is a 10 cent tax added onto a two liter of soda, I would be willing to be the producer/supplier would only pay roughly 2-3 cents. The consumer will pay the other 7-8 cents. I only outlined a couple of potential responses to the fact that the tobacco industry is getting around this tax and pointed out that the burden will eventually fall to the consumer regardless of who is taxed.

If you want a little more direct answer to the original question, I believe it will have no effect on the health care reform debate. The large majority of our politicians are not in tune with the general public. They will vote for anything that they feel loyal to regardless of how it is to be funded. If I ran my budget like our politicians run the nation's, I would have been bankrupt a long time ago.

[JerryLove]

Originally Posted by bravesfan007

Consumers pay the majority of any tax and producers pay very little. If there is a 10 cent tax added onto a two liter of soda, I would be willing to be the producer/supplier would only pay roughly 2-3 cents. The consumer will pay the other 7-8 cents.

Money represents goods or services. It is impossible for a non-producer to provide products.

Imagine there was only one good/service. Let's say "apples". So no construction work, no computers, no medicine: just apples.

So some people grow and harvest apples. They "sell" apples (apparently for other apples) to "consumers".

Now you say "the consumer pays for apples, not the producer".

Pays with what? Apples, all of which originate with the grower.

Inflation not withstanding (money from nothing) all money does is represent goods and services. When you give up money, through taxes or whatever, you are giving up the fruits of labor.. goods and services.

It is impossible to give what you don't have. So either the consumer is a producer giving up his product, or the consumer was given someone else's goods/services and that's what he's giving up.

It's logically impossible for any other case to happen.