Why don’ t we tax bad behaviour? (as opposed to good behaviour?)

Taxation has a redistributive function, namely to pay for government operations, programs, transfers among people; but, it can be used as policy tool to curb bad behaviour and reduce ‘negative externalities’. Taxes on alcohol and tobacco are examples of taxation designed, partially, to mitigate bad behaviour. The first use of taxation is something that left wingers generally support. The second is one that those on the right tend to find more acceptable. A sensible general heuristic for government taxation is as follows: if you want more of a good or service than the market will provide, then you subsidize it; if you want less, tax it. The first is more concerned with generating revenue; the second, with ensuring that policies don’t disrupt market-based incentives.


Can we somehow combine this heuristic with the need to pay for the costs of government? If so, it makes no sense to tax income. Income is the result of hard work, education etc.. Therefore, an income tax is a tax on a ‘good behaviour, namely, ‘working’. We shouldn’t punish desirable behaviour with taxation because, we'll get less of it. Why not just replace income taxes, which punish good behaviour, with excise taxes on socially and economically undesirable activity. So, instead of taxing income and investment (capital gains), we heavily tax a wide range of undesirable behaviours with negative externalities such as pollution, carbon emissions, religion, alcohol, tobacco, drugs, liberal-arts degrees, sugar, cable TV, celebrity magazines, meat etc… I’m sure we can think of more. This would have the advantage of reducing the prevailance of costly bad behaviour. We would also stop discourging good behaviour (working), and because there are lots of bad things we could potentially tax, it might also generate enough revenue to pay for the costs of government.