More Porn Taxes: A Graphic Display of Taxation as Social Policy

August 3, 2005

Eight senators proposed a tax on internet pornography recently, from the Washington Post:

A group of Democratic senators last week introduced a bill that would slap a 25 percent tax on Internet pornography sites to pay for a trust fund to “protect” children online.

Senators Thomas Carper (DE), Mark Pryor (AR), Mary Landrieu (LA), Joseph Lieberman (CT), Blanche Lincoln (AR), Ken Salazar (CO), Debbie Stabenow (MI), Evan Bayh (IN) & Kent Conrad (ND) proposed the legislation.

We have blogged on porn taxes previously here. The proposed tax is poor economically because it is non-neutral since it singles out a particular industry for heavier taxation.

Furthermore, the administration of such a tax would be extremely cumbersome and may lead to flight from the tax by the purveyors of internet porn. This also leads to questions of what defines internet porn versus content with artistic merit, but that is a separate legal topic.

Lastly, this is yet another example of social policy being implemented through the tax code, which is generally bad tax policy. Social policy is best left out of the tax code as it is less transparent to taxpayers than spending programs and leads to more tax complexity and less neutrality.


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