Sunday, February 20, 2011
Outrageous New Taxes
It's not April 15 yet, but thoughts are definitely lingering on income tax. And thoughts of income tax time also bring thoughts of all the new taxes that seem to have popped up lately.
It took many years for the country to reach the economic problems we're battling today, a situation that can't possibly be corrected overnight. Local, state, and federal entities from coast to coast are scrambling to find additional revenue in these difficult economic times. Something to lessen the budget deficit while the economy is recovering. And to that end, some new taxes have been enacted on all levels. Many new taxes, especially at the state and local level, are referred to as "fees" in an attempt to lessen the sting of taxation. But a tax by any other name…
Some of these new taxes are already reality and others are still in the debate stage. But to be in the debate stage means someone thought it was a good idea.
Sin taxes have always been popular with lawmakers. Taxing items and activities that are considered vices—smoking, drinking, gambling—seems to be an easy way to raise revenue. But the definition of "sin" seems to be expanding to include new things.
Card Tax: In Alabama, anyone who purchases a deck of cards is charged a card tax of 10 cents. The law states that the tax only applies to a deck containing "no more than 54 cards" which is the standard 52 card deck plus the 2 jokers. So if the manufacturer makes a blunder and your deck contains 55 cards, apparently that gives you a free pass on the tax?
Nudity Tax: Any business in Utah where "nude or partially nude individuals perform any service" are required to pay a 10 percent sales and use tax. The tax is levied against all revenue including admission fees, merchandise, food, drink, and unspecified "services." I wonder what is considered "partially nude" under this law? What about a life guard? Is that a partially nude person providing a service?
Tanning Tax: And for those living in a winter climate who want to maintain that golden tan year round? You'll be paying a 10 percent excise tax on using a tanning salon. This tax is expected to raise a surprising $2.7 billion over 10 years.
Candy Tax: In Kentucky, having a sweet tooth can cost you more than it used to. They now have a new sales tax on any food considered to be candy. However, the definition of what is and what isn't candy is controversial (and confusing). For example, Kentucky's definition says a Reese's Peanut butter Cup is candy, but a Milky Way is not candy. And to add to the confusion, there are seemingly healthy foods that have been classified as candy. If a breakfast bar contains natural or artificial sweeteners along with fruits, nuts or other healthy ingredients, but does not have any flour and does not require refrigeration, it's considered candy and is taxed as such. However, breakfast cereals with the exact same ingredients are not considered candy and not taxed. And the difference between the two under the eyes of that law? I haven't the foggiest idea! In looking at my Nutri-Grain bar, I see that it says Nutri-Grain Cereal Bar rather than breakfast bar. I wonder if that makes a difference in Kentucky?
New York City has come up with some unusual things over the years, but in scrambling to increase revenues they've proposed some truly strange new taxes.
Crash Tax: In January, the New York City Fire Department proposed a new crash tax which stirred up some very heated debate. This proposal calls for a $500 fine for anyone in an accident that requires emergency response vehicles (paramedics, ambulance, fire truck, etc.) at the scene.
Haunted House Tax: If a haunted house attraction includes music and the admission is more than 10 cents, then sales tax is charged. Yet the same New York City with one of the greatest theater districts in the world does not charge tax on theater-goers who see a musical comedy, go to the opera, or attend a chamber music performance. Does taxing a 10 cent admission to a haunted house while ignoring a $100 theater ticket make any sense to you?
Bagel Tax: If you purchase a bagel and take it home to eat, it's tax free. But, if you eat that same bagel at the bagel shop, you have to pay sales tax.
And New York City isn't alone is what seems to be desperation moves to increase revenue.
Death Tax: As of January 2011, it costs extra money to die in King County (Seattle) Washington. The county has levied a $50 fee for reporting a death to the Medical Examiner's Office. If you choose not to report it? Simple…if you don't pay the fee, you don't get the permission and necessary paperwork in order to be buried.
Until the economy recovers and the huge deficit budgets at all levels of government are under control, you can probably expect to see more of these outrageous taxes.
Do you have any new taxes of the absurd variety in your city, county, or state?