Why is it that government officials seem inspired to reach the heights of creativity coming up with new taxes? Who knows. But their efforts could mean you’ll be paying new taxes on everything from bicycles to bowling, 2-by-4s to marijuana.
Here’s a selection of six curious new taxes—some already in effect, others merely at the proposal stage:
Bowling, High School Sports
Ohio Governor John Kasich is proposing to add a 5% sales tax to a slew of previously untaxed purchases, including circuses, theme parks, museums, fairs, bowling, and tickets to sporting events and concerts. “Tickets for high school sports wouldn’t be exempt from the governor’s proposal,” the Associated Press notes of the plan, which is supposed to be combined with cuts to income and small business taxes.
For years, politicians and nutrition groups have floated the idea of a soda tax, with the hope that it would result in healthier citizens and increased revenues—some of which could be used to promote even better health. The idea has again surfaced in Vermont, where the House Health Care Committee just voted to advance a bill that would add a 1¢-per-ounce tax on all sugar-sweetened beverages sold in the state. One reason the tax may fail to become reality is the likelihood that it would hurt local businesses, which could lose shoppers to nearby New Hampshire—where there is no sales tax, let alone a soda tax.
Green Cars & Bikes
States collect money for every gallon of gas sold, via gas taxes. So when cars run on little or no gasoline—or when residents get rid of cars entirely—state revenues are hurt. Policies at the state and federal level often support energy-efficient vehicle ownership, and yet states don’t like it when they see declining tax income. That’s why Washington state has added a $100 annual tax on electric cars, and why a similar tax on alternative-fuel vehicles is being proposed in Virginia. Washington is also considering a separate $25 tax on bicycles that retail for $500 or more—because some motorists say that bike riders don’t pay their fair share to build and maintain roads.
Vehicle Miles Tax
As an alternative to boosting gas taxes or raising the sales tax—which is what Virginia may do while cutting fuel taxes—some suggest a VMT, or vehicle miles tax. Basically, you’d be taxed for every mile driven. “The idea is gaining steam and coming to a state near you,” reports CNBC, though many are concerned that monitoring drivers’ mileage would be “too much of ‘big brother’ tracking our lives.” A 2012 Government Accountability Office study on such a tax estimated that “drivers of passenger vehicles with average fuel efficiency would pay $108 to $248 per year in mileage fees compared to the $96 these drivers currently pay in federal gasoline tax.”
Since the beginning of 2013, retailers in California have been expected to collect an extra 1% in taxes on sales of 2-by-4s, plywood, and other kinds of unfinished lumber. The new tax, anticipated to “generate $30 million to $35 million a year to help the state enforce its stringent timber-harvesting regulations,” according to the San Francisco Chronicle, has proved confusing to stores as they try to figure out what’s taxable (there is no comprehensive list) and how to charge extra.
Earlier this month, Congressman Jared Polis (D-CO) and Congressman Earl Blumenauer (D-OR) introduced a bill that would simultaneously end a federal prohibition on marijuana and allow marijuana to be taxed at the federal level. The legislation wouldn’t legalize the medical or recreational use of pot in every state. But it would remove marijuana from the Controlled Substances Act, thereby giving individuals and businesses that grow, sell, and use the drug no reason to fear being in violation of federal law. What’s more, the Marijuana Tax Equity Act supported by the congressmen would impose an excise tax on cannabis sales and an annual “occupational tax” on all workers dealing in the growing field of legal marijuana.