what are the cost of a 25 cents tax on bottled water?

Question

is it efficient? will it create problems? possible alternatives?

the renvenue would be to raise money for the city's government

Answer 1

obviously it is not efficient. It will re distribute wealth, propably many people will get out of that industry cause it will increase costs, consumers will not buy the same ammount of bottled water, price will rise more than only the 25 cents....

possible alternatives?... I can't think of one

Answer 2

Since the contents cost almost nothing the price reflects distribution and retail markup. Bottled water can be purchased at discount retailers by the case for less than 30 cent a bottle, but sold cold by the single bottle may cost $2 at convenience stores and up to $5 venues like stadiums. The taxed would be passed on to consumers by discount retailers because it is competitively priced with a loss of efficiency. But when it is sold with very high markups it is because there is a "local monopoly" so the price would react to the tax with monopoly pricing so a tax might improve efficiency.

Since bottled water is a convenience not a necessity, because anyone can fill a container with water , and carry it, I do not see any problems. What the alternatives would be depend on the purpose for the tax, which you did not state in your question.


edit:
If you are just trying to get revenue, why not tax all soft drinks, or increase the sales tax on all food and drink "ready to eat" , or just the general sakes tax,

Note the revenues would be much less than "expected" from bulk sales of water, because of the high elasticity .