Corrective Taxes: Discussion Paper for Session 13 of the Tax Working Group

The attached paper is intended to help the Group decide whether it wishes to make recommendations on corrective taxes.
The paper provides:
· An outline of the theoretical framework for applying corrective taxes.
· An overview of current policy settings in New Zealand for taxes on alcohol and tobacco products, and of settings in certain other countries for taxes on sugar products.
· An assessment of the impact of these taxes against the standard tax principles of efficiency, equity, and compliance and administration costs; and a broader living standards assessment of their effectiveness in meeting wider societal objectives.