Consider the effect of imposing a 20 percent sales tax on automobiles in the short and long run. To analyze the influence of the tax, we can shift the demand curves because consumers are forced to pay a higher price. Notice that this tax is an ad valorem tax. The demand curve does not shift parallel to the old ones, but pivots to reflect the higher tax paid per unit at higher prices.
Unlike the automobile market, the gasoline demand curve is not characterized by a stock adjustment effect. The long-run demand curve will be more elastic than the short-run one, because in the long run substitutes (e.g., gasohol or propane) will become available for gasoline. We may analyze the effect of the tax on gasoline in the same manner as the tax on automobiles. However, the gasoline tax is a per unit or specific tax, so the demand curves exhibit a parallel shift.