I borrowed this from another poster on another site
Taxes, Taxes, Taxes!
Trying to determine how many of our dollars end up in government pockets can be difficult. It can vary widely depending on where you live, how much you make, and what lifestyle you embrace.
Uncle Sam has many, many hands with long, sticky fingers reaching into our pockets. He takes bits and pieces and chunks of our money, often without us even being aware. Taxes happen from Federal, State and local government and often include one or more municipal, township, district and county governments. Many tax mechanisms include regional entities such as school, utility and transit districts and the most subtle; liberate us of our money by employing others to do the pocket picking.
About that last point, it’s a fact that business entities and corporations in truth; pay no tax at all. They simply collect it from “we the people” in the cost of manufacturing and sales, and then pass it on as their fair share to the government. Ultimately, all taxes come from us…. in what we earn, what we sell and what we buy.
Fact: Government makes no profit, it only consumes.
Fact: To be fair, a large part of taxes we pay comes back to us in the form of regulation and oversight, infrastructure, education, social support programs, research, military and civil protection, social security and Medicare and public facilities.
Government can be good and a service we need, but unfortunately, can all too easily become corrupted and unnecessarily expensive. In extreme cases, government can become so corrupt it ceases to serve and instead, enslaves. When it comes to taxes, how much is too much? Is there a point where our “government” has become not “of the people, by the people and for the people” but instead, a self propagating machine, out of our control? Is there a point where we should take heed and again, take hold the reigns?
Let’s start at the top and try to see how deep the rabbit hole goes… We all know about the “chunk” that comes out of our paycheck. These “payroll” taxes are generally the combined taxes taken by the Federal and State government and Social Security. Generally this totals about 32% to 34% of our income although it can vary widely. (Federal tax alone can vary from 0 to 35% depending on income.)
Many of us as well, are aware of what we call, “sales tax”. In NC, (my home state) this is approximately 7% of the purchase price of most items. So, by the time I’ve received my earnings and spent them, approximately 39% has gone or will go into the public kitty.
Well ok…, but this bunny burrows deep and can sometimes be hard to spot.
Do you drive a car? Yeah, me too… In NC, the fuel tax rate is approximately 48 cents per gallon. Approximately 48 cents because 12% of this tax is variable, going up and down with the price of fuel. I average 20 mpg and approximately 30,000 miles a year. That’s about $720 a year in gas tax. Oh, and I have a wife and two sons that drive as well. Dang, more tax... One more thing… do you drive a “gas guzzler”? As much as $7,700 can be added to the new purchase of a “guzzler” in the name of “green”, but where does that “green” money really go? Do you know? Oh, and heaven forbid you use natural gas, propane or fuel oil to heat your home, which have similar fuel taxes. Electricity is taxed too, so Uncle Sam gets paid to keep you cool in the summer and run your TV as well. Do you pay insurance premiums? Whether it’s home, health, auto, life, business, employer, property, or whatever, I’m sure you do, and whoa mama, you wouldn't believe! Here’s a hint... The G-Man skims billions and billions a year playing this little side game.
Like I said, it gets hard to figure…
If you own any property like a house, land, car, boat, RV, motorcycle or truck, you actually only “kind’a” own it, because you’ll pay “ownership” tax for as long as it’s in your possession. (Do you really own anything you never stop paying for?) Drink alcohol or smoke tobacco? My, oh my, sin tax is high! (Liquor tax - $21 a gallon in Oregon, $26 in Washington, Tobacco tax - $1.19 a pack state average - $4.25 in NY) Ever purchase anything that has been imported? (We’ll come back to that one.) Ever received an inheritance or a gift of significant monetary value? (50% for some amounts over $12,000) Ever fly in an airplane? (7.5% of ticket + $3 per segment) How about guns? (11% rifles, 10% hand guns) Ever paid “court costs” or a parking ticket? This may be a fine to discourage evil doers but where do you think that money goes? Next time you’re in traffic court looking for your name posted on the wall, make a quick estimate of how many $30 fines and $90 court costs will be sucked into your city’s municipal pockets that day. You might be shocked and yes, that’s a tax. Take a look at your phone bill(s) next month and see how many nibbles at your wallet Uncle Sam enjoys when you’re chatting. (Consider 180 million USA adults, averaging two phones each, paying monthly. My family has four phones and we pay about $20 a month in tax. That’s $240 a year.) You watch TV? Oh yeah, Uncle Sam is there too, over-the-air and through the dish and down the cable he comes. (Not exactly a trip to Grandma’s house.) Have you ever had to obtain a building permit or driver’s license? How about a license plate, title or vehicle inspection? Tax, tax, tax, tax, tax... And why do we have toll booths to ride a particular highway when we’re already paying the fuel tax for this purpose? Tax, tax everywhere! (By the way… Between myself, the wife and two boys we have two cars, two trucks, a jeep and a motorcycle with the newest one being a 2002 model. The annual license fee is $43 per vehicle + $20 for inspection. The county property tax for all six comes in around $380. That’s $758 a year in tax, just to own them. This doesn’t include the tax collected at the original purchase or the pump or through the insurance.)
We mentioned imported goods and the fact that all manufacturers and sellers pass on their tax burdens to consumers in the form of higher prices. Every item imported into the USA (and every item exported) has a tasty slice paid to the good Uncle… Bicycles 11%, Cotton hammocks 15%, Some infant formulas 18%, Table linens 12%, Flashlights 18%, Peanut butter 143% (Wow!), Girdles 24%, Telephones 8%, Brooms 32%, Plastic school supplies 5%, Brussels’ sprouts 12% and over 70 specific items bear the nips and pecks of Uncle Sam’s beak before they even get off the docks. Oil is a big import item… Did you know that oil company profits are less than the taxes they pay? With the Excise, Income and Windfall Profits taxes, Uncle Sam makes more off gas than the gas companies! Yeah, seriously! It’s true!
Speaking of Excise tax… this insidious, virtually invisible tax is most often applied at a wholesale level to things like beer, wine, liquor and tobacco but unknown by most of us, is also applied to dozens of other items like rubber, steel and fabrics. This tax adds to the price of virtually every item that can be purchased. It’s hard to even begin estimating how this “hidden” tax affects the overall total of what’s being taken by our government. Did I mention it gets hard to figure?
Wait a sec… I forgot to mention... You know that payroll tax that gouges such a large chunk of your paycheck right off the top? Well, what you pay is only part of what’s actually taken. Your employer pays the other part for you... they have to match Social Security and Medicare and pay Unemployment Tax… That means that Uncle Sam is slurping down nearly 42% right off the top!
Is all this cash we’re paying our poor uncle really a good deal? (Maybe, but it’s hard to trust the old fellow, knowing he’s “borrowed” over 2.7 trillion from “our” Social Security, hasn’t paid it back and isn’t likely to. Of course that doesn’t stop him whining like a hungry newborn. Woeful, Uncle moans, “What shall we do? We simply must reign in Social Security entitlement costs!” Hey Uncle Sam! “Why not stop stealing it and see how that works out?” Just a note… even if Uncle Sam returned all he has “borrowed”, SS is still in trouble.)
LLCs, corporations and retail businesses all pay hefty, annual fees for the privilege of existing. Yeah, that’s tax. As a matter of fact, thousands of occupations like hair stylists, ferret breeders, palm readers and florists require special licensing. One state alone has over 500 occupations that require licensing and yeah, that’s all tax. Oh, and don’t forget marriage, adoption, pets, hunting/fishing and foster parenting licenses. These fees and literally thousands more, in addition to the 15% to 39% profit taxes companies pay, are lining Fat Sam’s pockets and all of this ultimately, is taken from us.
Do we get our money’s worth with government service? It’s doubtful. Government waste is legendary… and all these hidden taxes could be salary in our pocket if our good uncle could only manage the money we give him, the same as we have to.
Oh dear me, that rabbit hole do go on and on…
Over and above the call of “duty”…, In California, decorative trees and shrubs are taxed extra. Commercial vehicles, (truckers, construction, etc.) pay special “road” taxes. Ever stay at a hotel? Up to 40% of what you pay is tax. Yeah sir-ree buddy, now that’s showing you how to dig deep! Maybe you’ve noticed rental car fees… You’ll see some serious taxing going on there. In Alabama, playing cards are taxed extra and you need a license (that’s a tax) to sell them. Seventeen states tax illegal drugs and several, including the Federal government, tax income from illegal activities. In Maine, they have a special tax on blueberries and in Chicago; a fountain drink comes with an extra 9% tax. Of course for the canned variety, Uncle Sam only sticks you for 3%. In Utah, if you perform nude or partially nude, expect your poor Uncle to muscle into an extra 10% of that action. In most states, your great Uncle will be rooting through your pockets for spare change when you enjoy a professional baseball, football, basketball, soccer, hockey or tennis game, not to mention dog shows, horse races, car racing, etc. You like to fish? (10% on sporting gear) Archery? (.40 per arrow) Bottle deposits! Can you believe it? Yeah, that’s a tax! You are charged up-front for drink bottles and if you don’t return them, Uncle Sam keeps the change. Sure, it’s only a nickel, but at 13.15 billion gallons a year… What’s that? You’re thinking about mosquitoes? Yeah, I understand… leeches, ticks and blood sucking vampires’ come to mind too.
Want to bet that Uncle Sam enjoys a good wager? Our great Uncle will tax your winnings but you can't write off what you lose. Wow! You’ve got to admire the moxie, else why do we keep him on the payroll? And by the way, don’t even think you’re going to keep all those lottery winnings… Uncle Sam will take about half… and the lottery itself… where do you think most of the money from all the losers goes?
(I’m betting there’s a tea party at the bottom of one of these rabbit trails.)
Seriously folks, it’s a true “Wonderland’ and we’re just walking the borders. It’s astonishing to grasp just how much Uncle Sam and all his brothers and sisters and nieces and nephews are juicing from our pockets. Not only are taxes virtually everywhere, but government is constantly looking for new things to tax. In one state they’re looking to tax concerts, in another they want to tax well water, there are tax proposals on the table right now across America to tax HDTV, internet access, medical services, candy, caskets, veterinarian service, fire wood, newspapers, dry cleaning, American flags, legal services, metal bullion, gum, hygiene products, trout, museums, historical sites, zoos and parks and on and on and on. Seriously.., I’m not kidding. It’s unreal, and it’s serious.
Our government is currently considering a “Value Added Tax”. No tax sweetens a politician’s dreams more than a VAT. “Value Added” means products can be taxed at each stage of manufacture. Consider a suit jacket… Using the VAT mechanism, the raw material for thread would be taxed, taxed again when made into cloth and again as its cut to the proper shape. From there it would be sewn together thus adding value and making it subject to tax again. Add the lining, add tax. Add the buttons, tax again. The VAT allows taxes to remain hidden with the consumer seeing only the higher price and not the government burden that makes it so. In European countries, the cost of some products is as much as 70% tax. If you’ve been to Europe and paid $4.50 for a 16 oz Coke, you get the idea. We should not allow this to happen in America.
The average US citizen’s total tax is 54.4%. (
www.nowandfutures.com) I’ve estimated, given my home State, income and spending habits, that approximately 60 to 65 cents of every dollar I make ends up in one government pocket or another. (If we include the “hidden taxes” paid by corporations and the matching SS, Medicare and Unemployment paid by our employers, this number can easily top 70%.)
It seems very unlikely our government is spending our money responsibly and very likely the situation will get worse. Maybe our good Uncle and all his kin should become accountable for what we give them. Maybe it’s time our government remembers who “We” are and maybe, the time is coming when the wise thing for us to do, is take a stand.
Copyright 2010 M. L. Wester
Everyone is granted permission to copy and distribute this article (Taxes, Taxes, Taxes!) to anyone you please for non commercial purposes, as long as this copyright notice is distributed with it and the content is not altered. If you would like to publish this article on a website, through printed media or any means deemed commercial, please contact me for permission and to obtain an original copy via email at taxesarticle@yahoo.com. Comments are welcome.
Sources:
www.nowandfutures.com has some interesting information. Most every statistic cited in this article can be easily verified from multiple sources using a simple internet search for topical keywords. It is recommended that YOU do the research. Get educated, learn the facts and then decide... is it time for “change” that doesn’t involve taking more and more of our money?
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