April 15, 2009

A Tale of Five Tires.

Filed under: Uncategorized — Jim @ 9:18 pm

tires-fiveWithin the last week or so, I bought a new car. Yes, the Big, Fat, Black Capitalist Car is now history. More on the new wheels later, as this is a post about tax. It is, after all, April 15th.

OK so, you buy a new car in New Jersey. Not exactly pocket change, that. The car comes with four real tires and one of those bullshit donuts as a spare. Those five tires are clearly part of the new car. Agreed? Of course. The dealer adds up the total price of the car (including the five tires) and collects, for the state, seven percent of that number as sales tax. Seven percent is a pretty big hit, for sure. Do the math in your cruller.

Ah, but you’re not done paying tax on the car. In New Jersey, after you pay seven percent of the retail value of the car (including the five tires that come with it), you get to pay an additional “Tire Tax” (pdf) of $1.50 per tire, including the spare. Sure, you’ve just spent thousands on a car, including a couple thousand in sales tax, so what’s another $7.50? The rat bastards in Trenton are counting on you thinking like that.

But wait! You’re not done paying tax yet on those tires.

Suppose one of the tires is punctured and you have it fixed. Fixing a tire is a “service,” and you pay seven percent tax on the cost of fixing the tire. Suppose the gas station guy tries to fix the tire, but decides that he can’t fix it and sells you a new tire. You get to pay seven percent tax on the cost of the repair attempt, plus seven percent sales tax on the cost of a new tire, PLUS the tire tax.

Further suppose that, after a year or so, you decide to sell the car (including the four tires and the spare) to Joe Blow. Joe Blow will have to pay seven percent sales tax on the price of your car (including the five tires) AND the tire tax as well, which means that New Jersey has now taxed the same five tires at least FOUR TIMES.

And yet, the sheeple keep paying the taxes and voting the same cruds into office.


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