alcohol beverages and tobacco are common targets of sumptuary taxes in lesotho. explain the economic rationale behind heavy taxes on these two
Answers
Products which are not leading to any betterment of humanity, and doesn't contribute in any upliftment of society like alcohols and tobacco, are always tried to be minimized in society, sometimes it is not possible to make the products completely banned, in such scenario heavy taxes are levied on them, in order to minimize it's potential consumers, and raise a good fund out of that, which may be used by government, for a doing a betterment work for the society.
This way the economy gets stronger, and the usage of such avoidable products are minimized.
The economic rationale behind heavy taxes on alcohol and tobacco in Lesotho is following - The sumptuary taxes can be implemented for mitigating the use of tobacco and alcohol, vehicles emitting the excessive pollutants and gambling.
The Sumptuary tax is charged on soft drinks or sugar is also suggested. Some jurisdictions levied taxes on the recreational drugs i.e. marijuana. Various American cities have utilized the funds from the sin taxes for expanding infrastructure.