Joel S. Newman on Indoor Tanning Taxes: Health Care Reform and the Excise Tax on the Artificial Suntan

Abstract

The ten per cent excise tax on indoor tanning services was enacted as part of the Affordable Care Act. When a five per cent tax on discretionary cosmetic surgery was defeated, the tanning tax was proposed as a way to generate some of the lost revenue in the package. The tax has not generated as much revenue as had been hoped, and there are efforts underway to repeal it. The tax makes little sense, even in Pigouvian terms. Regulation of the industry, and education -- especially of young women -- would be far more effective.

Keywords: taxation, health care