A 10% levy on tanning is set to transpire soon in an attempt to feed the federal government an estimated 2.7 billion in, supposedly, needed funding. The comedy is of course in their faulty economics.
The bill differentiates between tanning salons and fitness centers that offer tanning packages. Tanning salons, like that of Sun Tan City or Solar Planet, are required to incorporate the 10% tan-tax within their pricing system whereas fitness centers are excluded. This differentiation could be understood as a discrete method of redirecting would-be tanners from the salons, to the gym, in hopes to increase the public’s health. Yet, the 2.7 billion in anticipated funding does not fully account for the economics of substitution. Being homogeneous in nature, tanners will likely just tan at the gyms to avoid the 10% tax.
The absurdity of the whole situation comes from the fact that the IRS has anticipated (and prohibited) the most common course of action for a tanning salon i.e. offering yoga classes or some other form of exercise in an attempt to take advantage of the loophole. Read more
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What a mess. We have tanners vs. gyms, electronic vs. sunless tanning, government vs. middle class female entrepreneurs, tanning vs. cosmetic surgery, all with jobs on the line. The losers will be outraged, the winners laugh all the way to the bank, and the sheeple don’t care as long as they get the health care. So sad.
Snooki will not stand for this.
http://blogs.wsj.com/metropolis/2010/06/10/jersey-shores-snooki-bashes-obamas-tanning-tax/
Gym, tan, laundry lifestyle? I think this is a guiddo backlash!!!
People who actually expect this to generate revenues work on an assumption that is generally used as the foundation of government intervention – people willing to play the part of the victim.
Government assumes the “revenue” under the guise of those using the services won’t adjust their habits and willingly allow themselves to be victimized by government. Government has gotten it into their heads that because those among the general population think government exists to keep people from being victimized into lower wages, monopolies, of violence, of poor quality or even dangerous products and services, etc, that the general public simply thinks itself as the helpless victim.
Government will get a small dose of reality when the expected revenues come well short in reality. People are just not willing to pick up the part of the victim.
Valid points here, but people can’t simply switch from salons to gyms, right? They have to join the gym to use those facilities. Some people will doubtless find that inconvenience not worth foregoing the 10% tax. Still, there’s no doubt some substitution will occur, and of course gyms can start offering tanning services to non-members.
Maybe people will find some other, cheaper (maybe even free?), alternative to tanning salons and gyms. Oh well, gotta go, it’s a nice sunny day outside.
Wasn’t this tanning tax the ‘compromise’ because the plastic surgeons of this country cried foul because they were initial source of this tax?
I thought it was because tanning was ‘unhealthy’ as if it were the governments job to protect us from everything that might be bad for us….
What are they gonna do next? Tax the sun?
Candlemakers’ Petition, by Bastiat.
tanning salons vs. gyms? Government is good at setting different groups upon one another, whereas the market is good at finding ways for different groups to work together.
Haven’t we going through this before with the 20% tax on the Luxury Yacht business? Back then Congress dumped this tax on super high end luxury yachts. (Strangely the business was centered in the states whose most powerful politicians were for the tax.) The results were predictable. The super rich dudes buying $5mil and up yachts just stopped buying them and purchased similar yachts from points overseas. A thriving industry servicing wealthy folks crashed and 60000 people lost there jobs.
You Austrians aren’t considering the social benefits of this policy. We’re hoping that attractive women will stop using tanning salons and spend more time outside with minimal clothing, creating a positive externality accruing to prurient adolescent males.
LOL @ Keynesian Klown’s idea of attractive women wearing less clothing outside as a result of the tan tax.
Anyway, this tax is stupid and could actually INCREASE the risk of skin cancer. What these skin cancer paranoid freaks don’t consider is that tanning is NATURAL. Our ancestors tanned under the sun all the time and didn’t have sunscreen and THEY didn’t have problems with skin cancer, obviously, or else we wouldn’t be here today. However, what this law might do is cause a higher incidence of SUNBURNS, which is what you’re really supposed to avoid, unless the displaced base tanners are all smart enough to wear sunscreen while tanning outdoors.
This is discrimination because black people don’t tan. They are always trying to hold us down. I new once we got a black president they would start discriminating against us white folk. “White unite!”
I was given a package that included tanning as well as massage and other pleasant things that in the end was not quite economical to my pocket.
$2.7 billion is nothing at all. But a tiny fraction of that would be very, very beneficial to a handful of politicians. This is an extraction attempt on the tanning business as a whole, who apparently aren’t paying their protection money via an industry-wide lobby.
It’s just political extortion. There is a threat of taxation, the industry under threat hires a lobbying firm, the politicians get paid, and the threat goes away for a while, and the industry being extorted gets away with paying 1/1000th of the original cost. It’s like a settlement.
See “Money for Nothing: Politicians, Rent Extraction, and Political Extortion” by Fred S. McChesney.
And unlike everyone else in this post, I don’t have any gym equipment to sell. Sorry.
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