From my post of September 2007 (two months after the English smoking ban came into force):
I looked up alcohol licences, and they appear to be only a few hundred pounds a year, depending on size of pub.
So if the council charges £10,000 a year to allow [a pub to have] a smoking licence, only a few pubs would go for it and the council rakes in a shed-load of money for no effort whatsoever, a form of Land Value Tax, if you will.
Everybody wins. The landlord only pays the £10,000 if he thinks he can increase his net profits by at least that much. The smokers win. The local council wins.
And most pubs would remain non-smoking - if all the pubs in any area paid the £10,000 for a smoking licence, then the advantage would be competed away, and some would give up the smoking licence again.
That's that fixed.
Now spotted by Gawain Towler:
[Following widespread flouting of the smoking ban and in view of its dire fiscal situation] The Greek government is planning to introduce smoking licences for wet-led venues* so that customers can smoke.
The cost will be decided based on the size of the establishments and any venue that allows smoking without the licence will be closed.
There is of course the fiscal incentive... The government believes it could bring in “at least” €50m (around £42m) from issuing the smoking licences.
* This appears to mean 'drinking establishments'.
Tuesday, 18 January 2011
Here's another one I prepared earlier...
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6 comments:
Mark, I am anon 12.04 in the comments on the Greek story at the Scottish F2C website.
http://f2cscotland.blogspot.com/2011/01/licence-to-let-people-smoke-in-greek.html
Please can you, as an economist, comment on my bidding idea. I realise that an auction system needs to be devised if the bidding is per sq ft of smoking area, but I recall something ingenious was used to sell mobile phone licences. I'm sure there must be a way.
Anon, yes of course it should be by auction rather than fixed fee, the same as for late opening licence or anything else. Forget the 'per sq ft' and make it for the whole premises (what does the council care how big or small it is?).
The council then has to make a decision how many licences to issue. If there are 300 pubs in their borough, then auctioning off 300 licences brings in revenues of £nil, auctioning off only 1 licence brings in 'not much' and maybe the optimum is 50 licences or something.
Thanks Mark. My scheme is slightly different to the usual one, in that the proceeds from the auction go to the non smoking pubs, rather than to the Council, so it is not a tax, but a payment from smokers to non smokers. I suggest this as a pragmatic smoker and someone who doesn't like handing money or power over to local councils. It is a sweetener to all those non smokers who could be swayed by "compensation" from smokers.
My question is:
Who would end up paying this money? Is it:
A) Smokers via higher drink prices
or
B) Landlords in general (as with suppliers paying VAT)?
Anon, the idea of paying the proceeds to the non-smoking pubs is a clever one (although possibly even more abhorrent than paying it to the council - I'd rather subsidise meals-on-wheels than non-smokers).
AC, a landlord would (on the whole) pay less for the licence than he makes in extra profits (so it costs him nothing); the smokers are happy to drink in that pub (or even if they pay slightly higher beer prices, that is just the cost of being allowed to smoke). Unlike VAT, such a tax has at least some positive aspects.
"Wet-led" = places that make more money from booze than food.
It's not far from John Reid's original, far more sensible plan to only impose a smoking ban in food venues in England - but that got amended to the full ban by the nutter, nannier side of Labour whining that the people who went to non-food pubs tended to be working class (which is true), to like to smoke (which is true), and therefore They Must Be Stopped otherwise Unequal Health Outcomes (which I'm happy to concede is utterly moronic).
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