Forget soda and tax NFL football failures instead!

  • Soda taxes in Philadelphia and Chicago are a moral and fiscal failure.
  • Cities should instead impose taxes that cut down on truly bad behavior and impact only the rich.
  • The best way to do that is to impose the "Football Follies Tax."

Wide receiver Josh Huff #11 of the Philadelphia Eagles fumbles the football forced by defensive end Frostee Rucker #98 of the Arizona Cardinals in the second quarter during the NFL game at the University of Phoenix Stadium on October 26, 2014 in Glendale, Arizona.
Getty Images
Wide receiver Josh Huff #11 of the Philadelphia Eagles fumbles the football forced by defensive end Frostee Rucker #98 of the Arizona Cardinals in the second quarter during the NFL game at the University of Phoenix Stadium on October 26, 2014 in Glendale, Arizona.

One of the most controversial tax ideas in recent years is the so-called "Soda Tax" that hits sugary drinks, with the hope of both raising revenues and reducing obesity.

The problem is that like most sales taxes, this measure has a much bigger impact on the poor, who statistics show are most likely to be the main consumers of said beverages. Also, a soda tax can easily be side-stepped by buying products in other municipalities, and mark yet another infringement on personal liberty by the government.

But the good news is that they raise lots of money, right?

Wrong.

Philadelphia's soda tax is already bringing far less revenues than expected. And Chicago's new sugary soda tax imposed just this month has already generated plenty of confusion and anger.

Now, the easy way out of this conversation for conservatives like me is to simply call for the elimination of this and other taxes, then ride away on my ideological high horse.

But let's get real. Democratic Party strongholds like Philly and Chi-Town are never going to eliminate these taxes. Or if they do, they'll just replace them with another regressive tax that harms the poor and small businesses the most. Instead of yet another hopeless plea to these cities to get over their tax addictions, it's time for a more realistic plan.

So here it is: I propose the cities of Chicago and Philadelphia can their soda taxes and replace them with hefty taxes on incomplete passes, turnovers, and losses for the Bears and Eagles, respectively.

Call it the "Football Follies Tax" on hapless, under-performing (and rich) NFL teams. Given that most football teams already receive billions in tax breaks and other local incentives, it's an idea whose time may have come.

This is admittedly far-fetched, but don't laugh: This tax hits all the right goals. It's aimed at decreasing bad behaviors, only hits the rich, and increases civic pride and excitement. It's also just about the only tax I can think of that actually taxes failure instead of success. And we all want more success, right?

But to make this really work, the levies need to be steep. Crunching the numbers I've come up with the following appropriate rates:

$250,000 for every incomplete pass.

$500,000 for every turnover.

$1,000,000 for every loss.

Using the 2016 statistics for the Bears and Eagles, the potential windfall would be impressive.

Last season, the Bears had 212 incomplete passes, (@ $250K apiece that's $53 million), 32 turnovers (@ $500,000 apiece = $16 million), and 13 losses (@ $1,000,000 per loss = $13 million), for a total revenue of $82 million if those taxes had been in place!

The Eagles would have brought in even more money, with 229 incomplete passes, (@ $250K = $57.25 million), 32 turnovers (@ $500,000 = $16 million), and 9 losses (@ $1,000,000 = $9,000,000), for a total of $82.25 million!

But that's just chickenfeed compared to what a major city like Los Angeles, that now has two NFL teams playing in L.A. County, could make from this plan. With the Chargers moving to the area this year, and using their and the L.A. Rams' stats from last year as a guide, the combined revenues from the "Football Follies Tax" could be in the $175 million range annually.

Now I know what you're thinking, couldn't the owners of NFL teams under this tax regime simply do what individual consumers do, which is to just move their teams to some new tax haven across the city or county lines?

Not so fast, my friends.

Just think of the terrible optics those owners would be facing if they tried. I just dare Bears Chairman George McCaskey to get in front of the cameras and explain to the fans that he and his family want to move the Bears out of town so they can fumble and lose more. The same goes for Eagles owner Jeffrey Lurie and the rest of the NFL. That might actually be worth losing the tax revenue to see, but not quite.

And what if those taxes actually produce some discipline on the local pro football teams and they start winning? Won't that hurt the city coffers now relying on lousy teams to stay lousy?

Nope.

Remember that the economic boost cities get from teams hosting playoff games, or just the added sales taxes from fans rushing to local stores to buy more team swag, can be significant. One home playoff game alone can bring in an added $13 million for a city's economy.

And the good feelings that come from having a hometown winning team can stretch far beyond just the football season, producing the kind of optimism needed to boost a local economy of years.

If you still think all of this is ridiculous, you may have a point. But compared to soda taxes, the "Football Follies Tax" is a much better course for America.

Commentary by Jake Novak, CNBC.com senior columnist. Follow him on Twitter @jakejakeny.

For more insight from CNBC contributors, follow @CNBCopinion on Twitter.