Tuesday, August 26, 2003
In Seattle, people are going to vote on a $0.10 tax per cup for espresso drinks. The money raised will go toward funding pre-school and day-care programs in the city. The potential windfall could be as little as $1.8M or as much as $10M. As much as I loathe income taxes, I like the idea of a small, directed consumption tax on a luxury item. Jacking the price of an espresso from, say, $2.25 to $2.35 isn't a bad idea, especially if it provides a place where children can be cared for. This is an idea that could be applied in many ways. Maybe a municipal area could institute a penny sales tax to raise education funds, thereby lessening pressure on the state government budget, and easing taxes on the state as a whole. Of course, this requires discipline on the part of the municipality. If one day Seattle starts charging $5.50 for an espresso because they let the budget go wild, then that's trouble and I have a feeling that Starbucks franchises in Tacoma will be getting a lot more business. Look at New York City as a prime example of this type of fiscal mismanagement.