Under pressure to increase tax revenue, a growing number of states across the US are considering a so-called “vanity tax” that would levy a sales tax on plastic surgery procedures.
New Jersey has enacted a 6% tax on cosmetic procedures. Washington, Illinois and several other states are considering similar measures. In Texas, Governor Rick Perry has proposed expanding the state sales tax to include “elective cosmetic surgery” as part of an effort to boost school funding.
“While I can see how this might appeal to people,” says Hackney, “it’s based on a misconception that most plastic surgery is elective.”
Hackney says that any tax on plastic surgery would be unworkable because of the difficulty in determining what surgery really is elective and what is reconstructive.
“A procedure such as a rhinoplasty – a nose job – could be considered cosmetic,” say Hackney, who specializes in such procedures, “But what about cases where the surgery has functional aspects, such as when it helps the patient to breath better? Or what if the surgery is done to improve the patient’s appearance after a trauma?”
Situations such as these must be judged on a case-by-case basis, Hackney says. That makes it difficult for a state government to determine when the tax should and should not be applied.
Hackney also takes issue with the proposed tax’s implication that plastic surgery is a luxury item sought by people with a high disposable income.
“For many of our patients the cost of surgery represents a sizeable portion of their income,” he says. “This tax would hit many people who are already straining their resources.”
If New Jersey’s experience is any indication, states may also fail to see the benefit they expect from the plastic surgery tax. While New Jersey legislators estimated their tax would generate $25 million in its first year, it raised only $7.8 million..
“In part that’s because of the legislature’s unfamiliarity with the industry,” says Hackney, “In part it’s because the tax simply pushed people toward out-of-state plastic surgeons. If you live in New Jersey, it’s easy to go to New York or Philadelphia for surgery.” Hackney says any state considering a plastic surgery tax should expect residents to likewise go out of state for their surgery.
This results in a significant loss of revenue for state hospitals. “Plastic surgery involves anesthesiologists, nurses, and other professionals, all of whom are impacted,” Hackney says.
Indeed, after only 18 months on the books, New Jersey is already repealing its tax. On January 30, the original sponsor of the tax, Assemblyman Joseph Cryan, took the unprecedented step of calling for a repeal of his own bill.
“That’s a good sign that this experiment is a failure,” Hackney says.
About the Hackney Plastic Surgery Clinic
Dr. Fred Hackney is a noted Dallas plastic surgeon and one of the few plastic surgeons double board-certified in plastic and reconstructive surgery and oral and maxillofacial surgery. He performs a variety of procedures including rhinoplasty , face lifts, breast augmentation and liposuction.
