Steadfast FinancesWhat Else Can the Government Tax?

What Else Can the Government Tax?

Filed in Taxes 16 comments

With most state and local governments caught between a budget crunch and possible receivership (bankruptcy), it would appear that many of them devising some fairly outlandish proposals to boost tax revenues. Depending on your point of view, these sin tax proposals range from making reasonably good sense to the asinine.

Having watched the debates at length for several months now, here is a short list of goods/services that have a fairly good chance of falling under the taxman’s purview in the near future.

  1. Soda Tax
  2. Marijuana Tax
  3. Junk/Fast Food Tax
  4. Bottled Water Tax
  5. Cosmetic/Plastic Surgery Tax

As the list suggests, it would appear that the government (federal, state, or local) is determined to tax anything that might give us, or result in, a little pleasure.

What else could the government tax?

Just for fun, I thought would be a clever exercise to identify any other items that the government could tax that might be “bad” for us.

  1. Car/Auto tax. I’ve lived in states that had a car tax of several $100 per month, but how could we raise in tax revenues if every car had a personal property tax attached to it?
  2. Household cleaners that double as poison. If you’re a green living advocate, you know very well that baking soda with water is one of the best cleaners available. So why not tax the very stuff that says “cleaner” on it, but yet the fumes are toxic and can’t be poured down the drain.
  3. Gas guzzlers. If you drive a SUV or truck that gets less than 15 mpg for no legitimate reason other than it’s because you like the option of driving 8+ people around on Saturday nights, should you pay a sin tax for polluting the atmosphere or using more gasoline that an average sized car?
  4. Porn tax. Since we’re obviously taxing some sinful industries, how about going after one of the most obvious? Setting up a big fat tax on companies like Playboy and Hustler could be a start, but surely their has to be place a small sin tax on any domain name with a sex related title.
  5. Hypochondriac tax. If you’re a perpetually sick patient who winds up in the ER or physician’s office more than twelve times a year for nothing but a head cold, should you pay an additional tax for overusing local medical resources? If you use more, shouldn’t you pay more?

Again, I’m not rallying support for or against any of these, but just throwing ideas on to the table that might make a little more sense, might generate more revenue, or lessen the impact on socioeconomic groups that can’t afford to take the hit.

If you have more ideas, please leave them in the comments section below.

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Posted by CJ   @   29 March 2010 16 comments
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16 Comments

Comments
Mar 29, 2010
11:25 pm
#1 LeanLifeCoach :

You missed the biggest one yet…. breathing tax!

Mar 30, 2010
2:19 am
#2 SJ :

What states have car taxes??
For the first set I’m up for 1,2,4,5… 3 i’m against cuz I dislike the smell of marijuana…
For the second set 1/2/3 seems to just be a progression of green tax. That makes sense… include the environmental cost in the pricing.
4 is another “sin tax” with 5 being an idiot tax.

I guess I’d be supportive of green taxes. And idiot taxes. Tho the latter could be seen as regressive… and possible the same for the green taxes…

Mar 30, 2010
7:55 am
#3 Vinny :

Porn tax is interesting. It’s hard to tax something that most people get for free online.

In that same vein… Internet tax or Facebook tax.

Mar 30, 2010
8:32 am
#4 FrauTech :

Interesting. California is considering legalizing marijuana with the upside that they will get tax revenue from it. However, I think they fail to realize that should the drug become legal the price is certainly going to plummet. For now the only thing keeping it from costing more than a houseplant will be the other states that haven’t legalized it yet, but once that happens say goodbye to revenue.

Taxes on items are usually a short term solution, but can discourage certain behaviors. We might do better by repealling tax incentives on mortgages of second homes, taxing American businesses for every job they send overseas, taxing businesses for each HB1 visa they use, and maybe making the capital gains tax a progressive one so middle class americans can still get a good tax break out of the stock market but hedge fund managers raking it millions every year will have to pay a higher portion.

Mar 30, 2010
10:42 am
#5 Matt SF :

Don’t we already pay that? It’s called FICA!

Mar 30, 2010
10:51 am
#6 Matt SF :

North Carolina has one. It’s a personal property tax based on the car’s value that is due every year. If you don’t pay, they block registration on your car.

Mar 30, 2010
10:53 am
#7 Matt SF :

Yeah, that would be tough to figure out. That’s why I suggested taxing sex related domain names. Although, the porn webmasters would almost certainly revolt, but if you’re goal is to apply sin taxes across the board, porn is the most logical place to start.

Mar 30, 2010
11:05 am
#8 Matt SF :

Marijuana prices will certainly fall. Many of the northern California growers are actually protesting the proposed marijuana legalization bills as they’re written because they fear that Big Tobacco will undercut their prices using more efficient growing and manufacturing techniques.

You bring up an important point that I nearly included into the post: instead of applying taxes to consumers, why not remove the tax breaks and subsidies given to the corporations making them. Let the free market be free, and when the prices on junk food and soda spike, that could have the same effect.

Mar 30, 2010
7:06 pm
#9 Abigail :

See, now, I always thought the solution to the marijuana pricing thing was simple: Let the government grow it. (Ok, all you anti-big-guv folks just give me a minute to explain.)

In Washington, all liquor is run by the state — and certainly it can be the state or county or even city government that controls it all — and so the price remains steady. Things still went on sale and such.

We could task the state (or county or city) with growing and supplying the marijuana. It would create plenty of jobs and ensure that certain standards are maintained: ie, it’s not laced with anything weird. It would also be somewhat more direct than a basic tax.

And I should add: I’m not a pothead. I really don’t like the stuff much. I just think that it’s about time we legalized it, given how much less dangerous it is than both alcohol and tobacco — especially if it means more revenue for the government. (And think how many teens will actually care about botany class finally!)

Mar 30, 2010
7:07 pm
#10 Abigail :

How about the computer tax? Or the broadband tax? Neither of which I’d love to pay but it seems plausible enough.

What about a strip-club tax? Just an extra buck or two per customer. It’s not like there aren’t plenty of singles flying around in there…

Mar 31, 2010
6:23 pm
#11 MyFinancialObjectives :

I agree with strip club and porn taxes! But then again I don’t partake in any of those things. Personally the only tax I would mind is the bottled water tax considering that’s that only item on the list I use. I don’t drink soda or eat junk food.

I also have a novel idea, what about cutting wasteful spending within the various sectors of government? I’m sure there’s plenty of that to go around…

Also how about some furlough days… A few of my friends had these, in addition to a pay freeze, maybe the government should try some of the fixes that the private industry is doing.

Apr 1, 2010
12:15 pm
#12 Matt SF :

I’ve seen the strip club tax in the news lately. Hopefully, they’ll get the patrons on the way in, because goodness knows they’ll be broke when they leave! ;)

Apr 1, 2010
12:20 pm
#13 Matt SF :

Yeah, it’s funny how the “don’t tax the things I use” concept works in our individual minds. I wouldn’t like broadband tax considering how much I use the net, but to each his/her own.

I know a bottled water tax could be fairly popular considering how expensive it is compared to tap water, but in cities like Los Angeles (where the water quality is pretty bad by my standards), I’m not sure it will be all that popular.

Apr 2, 2010
7:43 am

Would a tax on broadband also apply to 3g? Would a broadband tax affect more/less people than a bottled water tax?

Apr 2, 2010
2:58 pm
#15 Matt SF :

All good questions, and I think that’s where the politics (and lobbyist money) would cripple any such debates.

Since the government is pushing something of a “broadband for all” agenda, I’m doubtful we would see a big tax on residential internet service. But as you just mentioned, perhaps mobile broadband could be a prime short term target.

Another that’s been passed around is a “trader tax” where you tax daytraders or huge volume traders (say $1 million or more) a small fee per trade. Makes sense, but those traders also have the money to pay lobbyists, so who knows.

Apr 5, 2010
8:44 am
#16 Matt SF :

Ha! That’s sounds about right!

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