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Study: D.C. Tax on Plastic Bags Equals Job Losses

The study also found that the tax would cause a more than $100,000 loss in sales tax revenue.
February 7, 2011

WASHINGTON - A new study by the Beacon Hill Institute for the Americans for Tax Reform (ATR) found that the Washington, D.C., bag tax will cause the loss of more than 100 jobs and a decline in disposable income, Progressive Grocer reports. The study also discovered that the tax would lead to a drop in $108,340 in sales tax revenue and lower investments in the city by more than $600,000.

"We already knew that bag taxes are an annoying levy that provide no environmental benefit; now we also know that they are an economically destructive job killer thanks to this new report," said Grover Norquist, ATR president. "Unfortunately, it is also D.C.��s poorest communities that are hit hardest by the bag tax. Councilman Tommy Wells and other bag-tax proponents seem to be unfamiliar with the law of unintended consequences. In D.C.��s case, the bag tax has siphoned millions from the productive economy and thrown it into the black hole that is the D.C. government bureaucracy."

Last year, the District of Columbia��s nickel tax on plastic or paper bags handed out at retail locations went into effect. ATR pointed out that despite claims to the contrary, there appears to be no evidence that the bag tax has benefited the environment. Also, the group said research seems to point to reusable bags containing high levels of bacteria and lead.

"The bag tax is one of the more misguided taxes ever devised," said Norquist. "In fact, Washingtonians actually have to buy more plastic bags because they no longer have a stockpile of shopping bags under their sink to reuse for lining trash cans, bringing lunch to work and cleaning up after Fido. A well-funded lobbying campaign for job-killing bag taxes and bans continues in state capitals and city halls across the country. It is my hope that this study on D.C.��s experience will serve as a cautionary tale for taxpayers all across the country."