A luxury tax is a tax imposed on goods and services that are considered non-essential or high-end. This tax is typically applied to items like expensive cars, jewelry, and luxury vacations. The goal of a luxury tax is to generate revenue for the government while discouraging excessive spending on luxury items. Governments may implement a luxury tax to promote economic equality by targeting wealthier individuals who can afford to spend more on luxury goods. The revenue generated from this tax can be used to fund public services or social programs that benefit the broader population.