Other than the arguments about negative externalities, it seems more ethical (or fair, if you will) to have less or no tax on items that are necessary for life (food, shelter), vs items that are more of a luxury (big screen tv, party supplies). Not so much to curb certain behaviors and encourage others, but it would really suck to be taxed based on the oxygen your body consumes, for example. Or taxed on the vegetables you grow in your garden.