Armstrong Economics Blog/The Hunt for Taxes
Re-Posted Jul 20, 2018 by Martin Armstrong
Politicians are truly amazing. When they need money, they are never short of ideas of things to tax. New Jersey is proposing to now tax water from the tap. The proposal is being submitted by State Senator Bob Smith D-Middlesex. Of course, Smith is trying to say it’s not actually a tax and calling it a “user fee” even though you already get a water bill. A “user fee” would be a flat rate. He wants 10 cents per 1,000 gallons so it functions more like a tax than a one-time fee like getting a driver’s license. Smith obtained his J.D. in 1981 from the Seton Hall University School of Law. The only thing law teaches you is how to call a pig a cow and get away with it. It is probably inevitable that they will figure out a way to tax the air for making it clean.
They have in a way managed to tax sex as well over the centuries. In Nevada, they have proposed a $5 tax every time a prostitute performs a service. This is nothing new. The Roman Emperor Caligula (37-41AD) inaugurated a tax upon prostitutes per client (the vectigal ex capturis). There was the bachelor tax which was a punitive tax imposed on unmarried men. The Lex Papia Poppaea was introduced in 9 AD by emperor Augustus (27BC-14AD) to encourage marriage. Penalties were therefore imposed on those who were celibate, with an exception granted to Vestal Virgins. (Ulp. Frag. xvii.1). The law also imposed penalties on married persons who had no children from the age of twenty-five to sixty in a man. Women were taxed who had no children from the age of twenty to fifty (Gaius, ii.111) (Tacit. Ann. xv.19). As strange as that may sound, New Jersey and Michigan proposed a tax on bachelor men to change their behavior. They would also tax people without children within the member states of the Warsaw Pact to produce children for the army.
There have been plenty of ingenious excuses to impose taxes. When it comes to taxes, politicians just always show their creativity. California wanted to tax per mile a spacecraft traveled in the air after launch. Taxes are supposed to be about using services. They create a road and you pay to use it. Taxing space shots was really insane for they created nothing. Another issue that is probably unconstitutional turns on taxing people who have no right to object in a democratic process. Taxation without representation is what California began by taxing sports players for playing a game in California. Now many states have followed suit. The same process is underway in Europe. It was California which first imposed the Jock Tax back in 1991 as retribution following the Chicago Bulls beating the LA Lakers in the finals. The politicians wanted to punish Chicago and boldly said that the next time “His Airness” (Michael Jordan) played in Los Angeles, the money he made on those games was officially subjected to the California State Income Tax. Since that time, half of the states in the union have followed California and adopted a Jock Tax, taking a cut from high-paid heroes. So they get to tax your income for services you do not use and you have no right to object because you cannot vote in that state. That is taxation without representation – the reason for the American Revolution.
This clever way of figuring out things to tax has been going on since colonial days. Before income taxes, England imposed the Window Tax of 1696. They taxed you per window you had in your home. This was imposed in England, Scotland, and Great British Empire and enforced throughout the 18th and 19th centuries. The wealthy had bigger houses and a lot of windows. This tax directly led to the bricking up of many windows you will still see to this day. But they also altered society with the Window Tax in many ways creating row housing. That way you had fewer windows. Once Britain adopted the Window Tax, it spread around Europe. You will see old buildings in Poland with the windows still bricked in to reduce the taxes. If you get to visit Kraków, just walk the street in the old city and you will see more windows bricked up than open on some streets.
In Philadelphia, they also adopted the Window Tax being part of the British Empire. You see row housing in the old city to avoid the Window Tax. The clever minds of greedy politicians did not stop there. The term taking a “step up in life” came about because they also began to tax the number of steps you had into your house. The more steps, the higher the tax. So if you had more steps, that meant you were rich.
The Global Warming crowd is supported by the government because it provides the excuse to invent taxes. They argue that the number one producer of methane gas is cows who are causing global warming more so than cars. Now cow flatulence is the leading cause of global warming because of a cow’s slow digestion, mixed with a gas-producing diet of greens. Hence, to somehow reduce global warming, they claim that storing thousands of cows in one location creates large clouds of methane. To somehow make global warming OK as long as you pay a tax, Ireland, and Denmark, along with other EU nations, have begun taxing cattle owners on cow flatulence. The argument is that cows are responsible for 18% of the greenhouse gases causing global warming. Now Ireland is taxing farmers $18 per cow while Danish farmers pay $110 per cow. None of this reduces global warming, it just creates more revenue for the politicians.
They imposed taxes on spirits and cigarettes to encourage people to stop drinking and smoking – so they claimed. However, when the governments realized that stopping smoking is costly for them as tax revenue declined, they then imposed like New York City taxes on e-cigarettes. Sweden and other EU member states have suddenly realized they have a similar problem with people switching to electric cars. OMG, tax revenue will evaporate into the clean air. Now they are looking at taxing the electricity that replaces fossil fuels.
In the USA, Oregon and Illinois want to tax per mile you drive under the same excuse that electric cars are reducing their tax revenue. California is now investigating taxing people per mile they drive. They always do these things AFTER an election and NEVER before. The I-95 interstate federal highway up and down the East Coast is another e4xperiment where they are tracking cars and how they travel so they can impose a tax on per mile you drive.
Then you have state pensions in trouble. How to make up the difference? California wants to add a tax to cover state employee pensions. Then you do not even realize that phones and electricity are taxed by federal, state, and local governments. You just never see the breakdown.
Then there are airfares. In the USA, the number of agencies who have their hands out for taxes you never see is amazing. They ensure that your ticket is generally anywhere between a 20% tax to 100% doubling in the price of airfare. This is one reason why airlines are charging for checked bags and just about anything that use to be free for if they are not part of the ticket, then they are not taxed. It’s a bit overwhelming to consider just how many governmental departments and agencies are directly involved in the nation’s commercial aviation system that you have to pay for. This long list includes — but is not limited to — the U.S. Department of Transportation; its subsidiary, the Federal Aviation Administration (FAA); the Transportation Security Administration (TSA); Customs and Border Protection; Immigration and Customs Enforcement; the Animal and Plant Health Inspection Service; and the National Transportation Safety Board. Furthermore, commercial airports throughout the United States are operated on state, county, and city levels, as well as by independent port authorities and operators. So when you are standing in abusive lines and forced to take your shoes off in the USA and no other country, remember, you are paying for that privilege. Just the very basic starting fees are:
- Domestic Passenger Ticket Tax: collected for FAA; 7.5% of ticket price
- Domestic Flight Segment Tax: collected for FAA; $4 per segment, defined as “a flight leg consisting of one takeoff and one landing by a flight”
- International Arrival Tax: collected for FAA; $17.70
- International Departure Tax: collected for FAA; $17.70
- September 11th Security Fee: collected for TSA; $5.60 one-way for flights departing the United States, but not to exceed $11.20 round-trip
- Passenger Facility Charge: collected for “commercial airports controlled by public agencies”; up to $4.50 per passenger
The more connections, the higher the tax. On top of all that, you are charged $200 to change a ticket and if you do not make the flight, you can be just out and have to buy another ticket. The airlines will not refund all the taxes included in the ticket. You will find the mind-blowing travel charges exposed by the Business Travel Coalition. The average person trying to travel will usually find up to half the ticket price on domestic flights can be just taxes. Every possible agency is involved and they all have their fingers in your pocke