Thursday, 11 June 2009

Absurd tax to increase demand?

Here is a rant about something that seems bizarre: In Norway we sometimes watch commercials about the benefits of eating meat. It turns out that these commercials are financed by a tax on farm products. This is regulated by a law from 1936 in which the government promised to help the industry by increasing demand. The result was a tax on meat which finances advertisements for meat consumption. The tax amounts to about USD 2 per capita every year. This sounds a bit absurd. There is no lack of desire to buy meat. Could such a tax be justified?

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