 By Michael Reagan May 29, 2003
Americans are overtaxed, not only at the federal level but also at the state and local levels. When anyone mentions taxes, we automatically think of income taxes, but that's only a drop in the bucket. We pay taxes on just about everything we buy or do, day in and day out. As Senator Trent Lott once put it: "When you wake up in the morning and drink your first cup of coffee you pay a sales tax. When you start your car, you pay an automobile tax. Drive to work and you pay a gas tax. At work you pay an income tax and a payroll tax. You get home at night you pay a property tax. Flip on the light and you're paying an electricity tax. Turn on your TV and you pay a cable tax. Make a telephone call and you pay a utility tax. Brush your teeth and you pay a water tax. Even when you die, you pay a death tax." If you were one of the tens of millions of Americans who hit the road to take advantage of the Memorial Day weekend, or flew to your destination, you got hit with a lot of hidden taxes you didn't even know you were paying. In their feature "Tax Bites," Americans for Tax Reform (ATR) toted up the hidden taxes you paid while away from home. If you flew on an airline, ATR says 10 percent of the cost of your ticket was for taxes. Moreover, about 30 percent of the ticket price represented taxes the airline paid. If you drove to your destination and back, you paid about 37.7 cents in Federal and state taxes for each gallon of gas you used. And about 45 percent of the cost of your car represented taxes of one kind or another either you or the car company and dealer paid. Your stay at a hotel cost you a state sales tax and use tax on the hotel room of about 7 percent in most states. Local occupancy taxes charge another 6 percent. This means you directly paid at least 13 percent of the cost of a hotel room in taxes. Moreover, part of the cost of your room was your share of what the hotel paid in taxes.  ©Daryl Cagle, Slate.com Distributed to subscribers for publication by: Cagle Cartoons, Inc. While on your four-day weekend, you probably dined out. In most places, you paid a sales tax on your bill. Because many jurisdictions impose special, higher sales taxes on drinks or food sold at restaurants, the sales tax can be as high as 10 percent of your bill. But that's just the beginning says ATR. Out of your meal tab, the restaurant also paid federal income taxes, state income taxes, federal payroll taxes, unemployment insurance taxes, workmen's compensation taxes, state franchise taxes, local property taxes and any local income taxes. Altogether, these taxes average 17.6 percent of a typical restaurant bill. Counting the sales tax paid by the consumer, this means that about 27.6 percent of your bill ends up going to federal, state and local governments in taxes. When you got home you probably took a bottle of beer out of your refrigerator and sat down to relax. That bottle of beer cost an average 77 cents. Of that, 15 cents, or about 20 %, goes to state and federal sales and excise sales taxes. In addition, when the taxes the brewers of the beer paid are added into the price, about 25 percent of it represents taxes they paid. While enjoying that bottle of beer you may order a pizza by phone. About 50 percent of your phone bill goes to pay all sorts of taxes. And about 38 percent of what you paid for the pizza also goes to the government in taxes.
Do Americans need tax cuts? We sure do, and the President's tax cut hasn't come any too soon. It should have been bigger, but beggars can't be choosers, and since we're all being beggared by taxation we'll take what we can get. Mike's column is distributed to subscribers for publication by: Cagle Cartoons, Inc.
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