Center for Business and Economic Research - Ball State University


CBER Data Center
Projects and PublicationsEconomic IndicatorsWeekly CommentaryCommunity Asset InventoryManufacturing Scorecard

About

Commentaries are published weekly and distributed through the Indianapolis Business Journal and many other print and online publications. Disclaimer

RSS Feed

Disclaimer

The views expressed in these commentaries do not reflect those of Ball State University or the Center for Business and Economic Research.

Recent

Trump’s Tariff Recession Is HereMy new forecast, completed in late April, predicts a national recession began as early as March in reaction to Trump’s tarriffs.

Two Key Economic Lessons in One BillHoosiers face trade-offs and opportunity costs in the wake of SEA1.

Time to Fix Economic Development PolicyAllocating tax dollars to land development won’t cause economic growth.

The Unanticipated Effects of SB1Businesses, governments and households may all feel the effects.

View archives

Top Tags

jobs and employment 261
economics 202
state and local government 188
education 186
indiana 172
economic development 171
taxes 145
budget and spending 145
law and public policy 143
workforce and human capital 139
Browse all tags
Reporter / Admin Login

July 12, 2010

A Modest Proposal: The SUN Tax of 2010

The recently passed health care bill levied a hefty 10 percent tax on—of all things—tanning bed visits. More accurately, the legislation calls for a 10 percent excise tax (reportable quarterly on an IRS Form 720) for indoor tanning beds employing ultraviolet light. Of course, an exemption is made for any medically prescribed purpose such as skin ailments or for seasonal affective disorder. (Need I predict a jump in prescriptions for tanning beds?)

The problem is that this tax fails every single criterion of effective tax policy. It is narrow, easily avoided, suffers high administrative costs, and distorts consumer and producer behavior. It is downright silly, but I have a remedy.

In order to pay for the burgeoning federal debt, I think Congress should expand the scope of this tax. This could be done within a fairly small bill, perhaps passed during the shortening days between November 3rd and the seating of the new congress in January. Many members of Congress will need this time to focus on their new careers, and my modest proposal will take very little of their precious job search time.

I propose to simply eliminate the language taxing only indoor tanning beds. In its place we can substitute the phrase “Levies a 10 Percent Excise Tax on All Tanning Activities.” As with the current tax, this could be reported on a “fair market value” basis for all tanning services. I propose the Supplemental Uniform Non-entity or SUN Tax.

The SUN Tax would provide a huge government windfall. For each thirty minutes spent in the sunshine, each American could apply the fair market value for a 30-minute tanning visit (about $15 dollars). So, that’s a $3.00 SUN Tax for each hour spent outdoors. Think of the debt- defying benefit of this tax. If you mow the lawn (CHA-CHING!) $1.50 to Uncle Sam; walk the dog (BAM!) 5 cents to the IRS; take out the trash (VOILA!) two bits to the tax man. But it gets better. Three hours of Little League play is a whopping 9 times 3 times $3.00, or $81 bucks, not counting coaches or spectators, (unless the ten-run lead rule comes into play, shortening the game). There’s no end to the revenue availability. The SUN Tax can fix all our debt problems, with only a few modifications.

We’d have to exempt from the tax anyone working on solar panels. Also farmers should expect their own “Farmer Tan Relief Act.” And, yes we have to have some enforcement. That would mean an IRS agent on every street, and a tan registry. It simply wouldn’t do for a melanin challenged individual (see accompanying photograph) to suddenly emerge like George Hamilton, with a radiant glow without paying the SUN Tax.

This is real stimulus. And one added benefit; the tax would slow the movement of folks from the Midwest to the Sun Belt.

Link to this commentary: https://commentaries.cberdata.org/519/a-modest-proposal-the-sun-tax-of-2010

Tags: health care, taxes, stimulus


About the Author

Michael Hicks cberdirector@bsu.edu

Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. Note: The views expressed here are solely those of the author, and do not represent those of funders, associations, any entity of Ball State University, or its governing body.

© Center for Business and Economic Research, Ball State University

About Ball State CBER Data Center

Ball State CBER Data Center is one-stop shop for economic data including demographics, education, health, and social capital. Our easy-to-use, visual web tools offer data collection and analysis for grant writers, economic developers, policy makers, and the general public.

Ball State CBER Data Center (cberdata.org) is a product of the Center for Business and Economic Research at Ball State University. CBER's mission is to conduct relevant and timely public policy research on a wide range of economic issues affecting the state and nation. Learn more.

Terms of Service

Center for Business and Economic Research

Ball State University • Whitinger Business Building, room 149
2000 W. University Ave.
Muncie, IN 47306-0360
Phone:
765-285-5926
Email:
cber@bsu.edu
Website:
www.bsu.edu/cber
Facebook:
www.facebook.com/BallStateCBER
Twitter:
www.twitter.com/BallStateCBER
Close