Friday, April 21, 2006

Taxes Everywhere

John Stossel correctly points out that just because it's tax time we shouldn't be lulled into thinking the taxes we pay are limited to the income tax -- in fact almost every action we take nowadays involves a tax of one form or another:
In 1904, government, federal and state, cost every citizen $20 per year, according to a 1999 Tax Foundation study. Don't blame inflation --that only brought it to $340. For more than 150 years after we declared independence, we spent less than $1,000 each on government. Yet by 1999, government cost every man, woman and child an average of more than $10,000 per year -- more than housing and health care combined. The price went down a little after that, but then it started climbing again.

You probably don't know how much you pay, because the government is sneaky about how it taxes you. Paying withholding taxes each pay period dulls the pain of the income tax -- it's money you earned, but it's never in your hands -- and a hundred other taxes are hidden. For my TV special "John Stossel Goes to Washington," we followed St. Louis construction worker Bill Thurston and totaled the little-known taxes he paid daily. It started with the tax on the electricity that powered the alarm clock that woke him. Bill paid two taxes on his toothpaste. He paid a tax on water to get it into his home, and a sewer fee so it would go out. Daring to drive to work cost him more: He paid personal property tax on his truck; he had to pay sales tax when he bought it. And when he bought the gas, there was a county gas tax, a state gas tax and a federal gas tax.

At work, Bill gets stuck with local income tax, state income tax, federal income tax, Social Security tax and Medicare tax. Bill's boss needs two employees just to calculate how much to withhold from paychecks, and while their salaries don't go to the government (except for local income tax, state income tax, and so on), that's money Bill's employer can't spend on developing his business or giving Bill a raise.

Because Bill's wife works, the Thurstons pay a marriage tax of $1,000 a year. Then there's the grocery tax, property tax, utility tax, FCC tax and a county tax on the cable TV, and a whole bunch of different taxes on the phone. And if after paying all these taxes Bill and his wife want to relax with beer or cigarettes, there are sin taxes on those.
The ubiquity of taxes just underscores how hopeless it is to try to oppose them on an ad hoc basis. The only way to fight them, and their immediate cause -- the ever-expanding public sector -- is by challenging their root. Specifically, only by advocating egoism over altruism (i.e. by recognizing that every man is an end in himself and must be free to pursue his own purpose and happiness) can we get to, and ground, the concept of man's rights, including its proper political implementation: laissez-faire capitalism.

HT: 6th Column


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