Hot on the heals of the recent increase of the federal tax on cigarettes, which went from 39¢ to $1.01 per pack, the White House is planning taxes on several other consumer items. Most non-smoking Americans turned a blind eye to the tax increase on cigarettes. It’s easy to have a holier-than-thou attitude when it comes to “sin taxes,” but the next round of taxes will hit those same pious people in the wallet.
The tobacco tax increase was touted as a way to pay for child health care, but the White House discovered that even at $1.01 per pack, the tax base, and therefore the tax revenue, was too small. More popular items were then targeted for federal taxes because there is money in numbers. The consumer items being talked about for the next round of taxes are more mainstream. If the tax increase doesn’t reduce sales, the number being bandied about by the government is $3.8 billion in new revenue.
For all you non-smokers who were so keen on the tobacco tax, I have this question, how do you feel about the proposed taxes on these items? Which one is your sin?
|Item||Proposed new tax or increase|
|Candy||varies from 1¢ to 3¢|
|Batteries||varies by size 3¢ to 12¢ per cell|
Manufacturers are scrambling to head off these new taxes by petitioning Congress and employing lobbyist. The Coca-Cola Corp. which produces both softdrinks and bottle water, has no less than 30 new lobbyist headed to Capital Hill.
In the end, corporations don’t pay taxes; consumers do. So hang on to your wallets Mr. and Mrs. Middle America. The government is going for the big money in little bits. The White House is hoping you don’t notice a few cents here and there. Plan your budgets accordingly because the plans you had for your tax refund (which is your money to start with) just changed.