Yet another friend quit drinking a few months back.

He turned up at a dinner party the other night looking clearer-eyed and less paunchy and, he says, feeling better and sleeping at night.

We all congratulated him, over a bottle of good wine. And of course, behind his back, there have been various discussions of whether he's now less fun than he was when he'd tell guests to descend his cellar stairs and take their pick from his superbly stocked electronic wine cellar (he's a generous fellow).

Well, his fun quotient seems pretty much the same to me. But what I really admire is the fact that he's found a way to pay considerably less tax.

Liquor taxes

The liquor-and-wine price-fixing monopoly known as the Liquor Control Board of Ontario (LCBO) sent the provincial government a "dividend" of $2.06 billion last year.

It also sent nearly half a billion dollars to the federal government in sales tax. LCBO prices contain excise taxes, import duties, "wine levies," "volume levies," "environmental levies," the "LCBO rounding revenue," the "LCBO markup," etc. A hot slurry of taxes. There are even taxes on other taxes. And all of it topped off by the tax imposed on alcohol consumed in restaurants, adding yet another 10 per cent to the total grab. It's quite the machine.

So, given my friend's former taste for good wine and liquor, it's a safe bet he was paying at least a few thousand a year in taxes; money he can now pocket with a grin, having pulled at least one suction tube from the big Canadian revenue-milking machine off his financial teats. The rest of us chumps, generally unaware of the size and tentacles of the machine, will keep right on paying.

Taxes on alcohol are known as Pigovian taxes. They are applied to offset what economists call "negative externalities." (The Canadian Press)

Of course, the LCBO does everything it can to encourage that addled state of ignorance. The taxes they impose are hidden in the bottle price. But they shouldn't be. Here's why:

Taxes on alcohol are known as Pigovian taxes. They are applied to offset what economists call "negative externalities." In the case of booze, that means the social cost caused by excessive drinking – the impact on families, productivity and health.

Tobacco taxes are another example. As are the levies now being imposed in the United States on sugary beverages.

Logically, then, a Pigovian tax should be right there, in black and white, up front and glaring. If the idea is to moderate alcohol consumption, an LCBO receipt for, say, an order of imported wine should have a line in capital letters saying "OF THE $300 YOU JUST PAID, $180 WAS TAXES." (The combined federal-provincial tax bite on table wine is about 60 per cent).

But the LCBO doesn't want you to quit drinking. Quite the opposite. That's the paradox.

Alcohol ads

So, even as it imposes huge taxes to encourage what it calls "socially responsible" drinking — which, if my doctor is to be believed, is no more than a few glasses of wine a week — it is constantly sending out promotions and advertisements, flogging expensive booze, even deploying the ridiculous parlance of wine appreciation (lashings of tobacco and wet earth, deep blackberry brambles, complex notes of licorice and oak, blah, blah, blah….).

Why? Because government needs the money. It needs the tax money it vacuums up from drinkers, and smokers, and just about every other sort of consumer.

To governments, especially liberal governments, most taxes are either Pigovian, meant to modify bad behaviour, or political, meant to encourage what the government sees as good behaviour. Or at least that's the official rationale.

Take another example: parking tickets.

Officially, they are meant to encourage behaviour that increases public safety and orderly flow of traffic.

But look around your city and try to make some sense of the rules. "No Parking" zones seem to be increasingly replaced by higher-tax "No Stopping" zones. And there's little consistency. You can park in front of my neighbour's house, across the street from mine, but park in front of my house and a government agent will hit you with a $70 tax called a ticket. There is no evident reason for it, other than revenue hunger.

In Montreal, parking enforcement accounts for four per cent of municipal revenues: $186 million in 2011. (Pasquale Harrison-Julien/Radio-Canada)

Then there's the tax imposed for overstaying the time you've paid for at a parking meter, which is itself a tax. How is safety and order enhanced by taxing someone $50 or $60 or $70 for violating the terms of a smaller tax?

A few years ago, the City of Winnipeg, which issues the heftiest parking tickets in Canada at an average of $86 each, came right out and ordered its enforcement agents to impose an additional $1.5 million in fines. Just get us more money.

The City of Toronto, which also wants its enforcement agencies to generate more tax revenue, claims it uses parking tickets/taxes to manage traffic congestion, but most of the tickets its agents hand out are away from high-traffic areas.

In Montreal, municipal officials proudly say that the city's ferocious parking enforcement accounts for four per cent of municipal revenues: $186 million in 2011.

Such is Montreal's appetite for parking taxes that a handicapped parking permit is nearly useless in that city, compared to other Canadian metropolises. Montreal offers disabled motorists far fewer protections from its roving tax agents.

Tellingly, scofflaws, the idiots who pile up a ton of unpaid parking or traffic fines — taxes — can be referred to the Canada Revenue Agency, the big gorilla of tax collection.

And Ontario's so-called "Sunshine List" of public servants who made more than $100,000 last year contained the names of 13 "parking enforcement officers," the modern equivalent of meter maids.

At a guess, all 13 are superstar ticketers: highly valued, super-efficient tax agents.

Chaos by compliance

Anyway, here's a thought experiment:

If we all followed my newly abstemious friend and stopped drinking, and, as I do, strived to obey every single silly little parking and traffic regulation (I've collected two tickets in the past six years, since I began counting, and had one knocked down by half), what would happen?

It would create chaos, just as it would disrupt credit card companies if everyone paid in full each month. Governments would probably respond with higher property or income taxes, just as credit card companies would respond with huge annual fees.

Or maybe police would just start grabbing cash from motorists, the way American cops do.

As Heather Evans of the Canadian Tax Foundation responded, somewhat bemusedly, to my hypothetical question: "Municipalities would have to take some sort of corresponding action."

She says that in fact, demographic shifts in recent years will force Canada's cities to collect a lot more money in the years to come. There will be more, not fewer tickets, and higher, not lower alcohol prices, among other things.

But let's face it, governments are safe. Most of us are not going to stop drinking, the lunacy of smoking will continue and the sheep among us will continue to collect and pay parking tickets.

It's a great tax avoidance opportunity, though, for independent thinkers. On reflection, I intend to drastically reduce or even cease my alcohol consumption, for no reason other than shifting the bill to all the other chumps.

This column is part of CBC's Opinion section. For more information about this section, please read this editor's blog and our FAQ.