More and more politicians want to tax the bag you use to carry purchases home, though the purchases often have already been taxed. More than 20 bag-tax bills were introduced across the country in just the past year. From New York to Hawaii, chances are lawmakers in your state or city have considered taxing plastic shopping bags or will do so in the future.
Bag taxes were approved most recently in Washington, D.C., where next year, shoppers will have to pay a 5-cent tax on all paper and plastic bags used at every grocery, convenience and drug store in the nation’s capital. This in addition to a D.C. sales tax on non-grocery and nonmedical items.
However, not everyone is jumping on the bag-tax bandwagon, and results from where it has been imposed suggest that the District’s bag tax is unlikely to meet proponents’ goals.
In May, the Philadelphia City Council shot down a bill to tax plastic and paper grocery bags. An attempt to implement a citywide plastic-bag ban subsequently was introduced and rejected in June.
New York City Mayor Michael Bloomberg has been a vocal proponent of a 5-cent tax on plastic bags. That proposal died this year in the face of resistance from his own city council, which contended that the new levy was too costly in the midst of the deepest recession in a generation and in what already is one of the most expensive locales in the United States.
In what came as a shock to many, the crunchy, environmentally minded voters in ever-so-blue Seattle rejected a 20-cent plastic-bag tax at the polls in August by a nearly two-thirds majority. In California, legislation to impose a 25-cent bag tax died in committee.
While Americans pay taxes on almost all goods, the preponderance of budget shortfalls at the state and local level has prompted many legislators to target even that which is not purchased. Though they’re nothing more than a money grab for revenue-desperate lawmakers, bag taxes are always sold to the public under the auspices of litter reduction and environmental protection.
The truth is there are no studies that show bag taxes or regulation benefit the environment. In fact, there is only evidence to the contrary.
Environmental groups and other bag-tax advocates point to Ireland and San Francisco as policy models. However, experience there highlights the ineffectiveness and adverse impact of bag taxes and regulations.
In 2007, San Francisco became the first city in the United States to pass an outright ban on plastic bags. San Francisco conducted litter audits before and after the ban. The results? The ban had no impact on the city’s litter-mitigation goals. In fact, bag litter increased, making up 5.9 percent of total litter after the ban compared to 4.4 percent before the ban.
Then there is Ireland, which approved a bag tax in 2002 and is often lauded by those who wish to impose bag taxes on this side of the Atlantic.
Ireland’s bag tax caused use of plastic shopping bags to decline by more than 90 percent. What bag-tax proponents conveniently fail to mention is that the amount of all plastic bags used on the Emerald Isle (including those bought to hold trash and for other uses) actually has increased 10 percent since the tax went into effect. This underscores the fact that consumers rarely discard plastic shopping bags after one use, and efforts to discourage the use of plastic shopping bags can increase the total number of plastic bags used. In fact, 92 percent of the population reuses plastic shopping bags to line trash cans, clean up after pets and for a host of other functions.
Reducing litter in our cities and states is a worthy and noble goal. However, efforts to do so by imposing a highly regressive tax on every bag used at the checkout have proved to be misguided and ineffective.
Voluntary efforts and incentives to encourage recycling and the use of reusable bags are working. In 2006 alone, recycling of plastic bags increased 24 percent. Market forces and consumer education will cause this positive trend to continue.
It is this combination of information and incentives, not taxation and regulation, that will yield the best outcome for family budgets, employers, the economy and the environment. Bag taxes and plastic-bag bans will continue to be proposed in states and cities across the country in the coming months and years. Given the results from places where such policies have been tested, lawmakers and voters would be wise to sack the bag tax.
Patrick M. Gleason is state affairs manager for Americans for Tax Reform, a nonprofit taxpayer advocacy organization.