Don't Mess With Taxes

Sin taxes are supposed to encourage help force people to break what are generally perceived as bad habits.

One of the most common sin taxes is an added levy on cigarettes.

It has long been argued, and shown in some studies, that the tax is effective in keeping young people from starting to smoke. They tend to have lower incomes, so a hefty tobacco tax makes the habit too expensive for them, especially when they consider other ways they could use the money that otherwise would turn to ash.

Now it looks like cigarette taxes also can improve the health of the very young.

Higher taxes = healthier babies: A new study for the January 2016 issue of the medical journal Pediatrics (published online Dec. 1) says that increased cigarette taxes have led to declines in infant mortality.

The researchers compiled data for all states from 1999 to 2010 and ran a series of models to examine the connection between cigarette taxes and infant mortality.

Their results indicate that with nearly 4 million annual births nationwide, a $1 per pack increase in cigarette taxes could lead to 750 fewer infant deaths each year.

During the 11 years studies, the overall state infant mortality rate in the United States dropped from 7.3 to 6.2 per 1,000 live births. During that same period, inflation-adjusted state and federal cigarette taxes increased from $0.84 to $2.37 per pack.

"In multivariable regression models, we found that every $1 increase per pack in cigarette tax was associated with a change in infant deaths," according to the study, led by Dr. Stephen Patrick of Vanderbilt University.

The survival rate of babies during this period of increasing taxes was greatest among the African-American population. Infant deaths among blacks declined from about 14 to 11 per 1,000 births, according to the research.

Patrick and his colleagues say that increased cigarette taxes might be a viable consideration as state and federal lawmakers and officials explore ways to continue the trend of higher survival rates for infants.

Facebook founder's new daughter, new charity plan: Health-related programs and policies that cure disease so that today's infants can live much longer and healthier lives are likely to get support from the newly created Chan Zuckerberg Initiative.

As the name indicates, this is the brainchild of Facebook founder Mark Zuckerberg and his wife Patricia Chan, who just happens to be a pediatrician. And its creation was prompted by the birth on Dec. 1 of their first child, daughter Maxima, nicknamed Max.

Mark Zuckerberg and Priscilla Chan share their joy at the arrival Dec. 1 of their daughter Max, via, of course, Zuckerberg's Facebook page.

Through the Initiative, Zuckerberg and Chan plan to donate most of their Facebook holdings, currently valued at $45 billion, and use the money to support a variety of causes and efforts.

And just what will get the Silicon Valley power couple's donated dollars? In a letter posted on Facebook to daughter Max, new parents Zuckerberg and Chan say they are committed to making the world better, not just for her, but for "all children in the next generation."

Health concerns were specifically mentioned in the letter, as were technology, education and efforts to promote increased human potential and equality.

Yes, it's all bit vague as to specifics to achieve that, but that's not a problem. As I note last this week at my other tax blog, Zuckerberg and Chan have established a more flexible way to support the causes they hope will make life better for Max and her generation.

The Chan Zuckerberg Initiative is a limited liability company instead of a traditional 501(c)(3) charitable organization.

Without the restrictions of Internal Revenue Code rules on nonprofits, the LLC has flexibility to invest in companies that create innovative products or services that Zuckerberg and Chan view as contributing to the betterment of their daughter's life, as well as lobby for legislation and seek to influence public policy.

In essence, Zuckerberg and Chan emphatically like the entrepreneurial approach and flexibility that their new business-based Initiative affords them when it comes to supporting charities and other programs they deem worthy.

More  charity tax talk: Also over at Bankrate Taxes Blog this week, I looked at the despicable rise of charity tax scams during the holiday season.

Too often, crooks take advantage of the giving season to steal the money and personal and/or financial information of the good-hearted who want to help out those less fortunate, especially during this annual time of giving.

That's not to say you should stop all your charitable donations in December. Continue to give to the groups you support and know are on the up-and-up. Just be on the lookout, though, for tax identity theft scams disguised as philanthropic pleas.

I usually post my additional tax thoughts at Bankrate on Tuesday and Thursday and then feature them the following weekend here at the ol' blog. But this week I'm on a roll, so you're getting same-day heads-up for today's and same-week for Tuesday's posts.

You also might find these items of interest:

• Cigarettes are a bigger state tax target than booze
• San Francisco, Berkeley voters split soda tax ballot initiatives
• Alabama's governor proposes a soda tax for fiscal rather than physical benefits