Every day, we pay taxes. Whether it is the property tax for the house we own, our income tax, or the sales tax at the store register. Unfortunately, we often pay “hidden” taxes, and we don’t even realize we are doing it.
These “hidden” taxes amount to billions of dollars each year. Some experts estimate that our federal income tax is less than half of the taxes we pay each year. Surprisingly enough, we pay taxes on everything from rental cars to flashlights!
Below are a few examples these “hidden” taxes.
Electricity Tax – Each month, your energy company collects tax based on your energy consumption during the prior billing period.
“Sin” Tax – The tax on cigarettes, beer, liquor and gambling is different in each state. Tobacco taxes alone provide billions of dollars to the U.S. Treasury each year, and are highest in New York. The lowest tax on alcohol is in Wyoming, while the states like Alaska have massive taxes on beer.
Alternative Minimum Tax – Wealthy taxpayers are most affected by the alternative minimum tax. When the tax was written in 1969, it was intended to ensure that America’s wealthy pay a minimum amount of federal income tax, despite their possible exemptions. If your annual income is between $200,000 and $1 million, you pay 26 percent, if you earn more than $1 million, you pay 28 percent. Chances are, you consider yourself middle class like millions of other Americans, but you are still required to pay this hefty tax.
Cable Tax – Yep, if you are a cable TV subscriber, you pay taxes on this service.
Gasoline Tax – You pay taxes to both your state and Federal government (approximately 18.4 cents per gallon) for gasoline consumption. If you are driving a large SUV, watch out. Not only do you pay the gasoline tax, you also pay an additional “gas guzzler” tax at the dealership.
Self-Employment Tax – If you are your own boss, you pay Social Security and Medicare taxes, much like the taxes paid by the typical wage earner.
Import Tax – Excise taxes may be the taxes that go most unnoticed. When the U.S. imports products such as peanut butter, school supplies, bicycles, brooms, and flashlights, we pay taxes-reflected in the price at the register. Import taxes inflate the price of imported products, making the prices more competitive with their domestic counterparts.
Travel Tax – The next time you decide to fly somewhere, consider that the taxes you pay when traveling can account for more than one-third of the overall cost of your vacation. Whether you are paying taxes on airfare, rental cars, or hotels, it all adds up to a hefty fee.
If you have further questions about taxes, or you have questions about tax debt resolutions, contact a tax debt relief professional at US Tax Shield.