*Disclaimer* Ghetto taxes are not applied by the government. It’s not an actual tax, but I found it super interesting and relevant.
Luxury taxes are taxes on goods that aren’t necessities like expensive clothing and high-end cars. This tax is usually higher than the original sales tax. Of course, this is reasonable because a private jet isn’t an essential item.
On the other hand, there is the ghetto tax. Last semester in my global public health issues class, we learned about something called the ghetto tax. This “tax” is the increased prices of essential goods used in poor neighborhoods. It is like a convenience fee. This is usually on groceries and clothing but also on things like insurance and home mortgages. no-one-can-afford-to-be-poor In this article, they find home insurance is about $300 more in poor neighborhoods and car insurance. They find that the poor spend $50 to $1000 more on car insurance. Some of the examples given in the article really add up and can set these people back.