10 Insidious Taxes that are not direct taxes collected but negatively impact citizens while benefiting the government, their cronies and special interest groups
Many government policies have the same effect as taxes without being called taxes. They transfer resources from citizens to the government or special interest groups.
1. Inflation
This decreases the value of money you already have and reduces your buying power while effectively lowering the government's debt. The government pays yesterday's expenses with tomorrow's dollars, which are not worth as much.
Many of the policies on this list cause inflation.
2. Tariffs
While there are many political reasons to enact tariffs they artificially raise prices on goods and the government pockets the difference.
3. Subsidies
These can provide short-term relief for certain groups like farmers in a bad year. However, they have the long-term effect of raising prices and causing inflation. They can also cause poorly run businesses to survive artificially. This punishes the effective operators by forcing them to compete in an uneven landscape. It is also a disincentive to fix the problem.
4. Tax incentives for electric vehicle purchases and solar power
This is a direct subsidy to an industry: a government-sponsored coupon for wealthy early adopters. It also lowers total tax revenue. Only those who can afford to spend thousands on electric stuff get any tax benefit from these policies.
5. Guaranteed student loans or student loan payoffs
By removing the risks that these loans would not get paid college prices shot up for everybody else. People are saddled with debt that they were unprepared to take on.
6. Cash-for-Clunkers
https://fee.org/articles/cash-for-clunkers-was-a-complete-failure/
7. $25,000 down-payment assistance to first-time homebuyers raise prices for everyone else
That just makes all of the houses $25,000 more expensive for second—and third-time home buyers, raising the tax rolls of local governments that collect property tax.
8. Zoning laws prevent new construction and raise real estate prices
By restricting new construction, existing houses increase in value rapidly. We see this problem in places like San Francisco.
On the other hand, zoning laws in my area are not strong enough, and people are building apartments on what used to be farm land. The infrastructure can't keep up.
9. Negative Externalities
An example is when someone is allowed to dump their pesticides into a lake. The fish die, and the residents are negatively affected, but they are not compensated in any way, and the person who did it did not have to pay for it.
10. Legalizing "smaller" petty crimes
This is a terrible policy. It lets people commit more minor crimes like shoplifting with impunity. This causes many stores to either raise prices or go out of business or both. A Target supercenter near me was in a bad area about 10 years ago. There was so much theft they could not stay in business. They closed the store and built concrete block walls in front of the doors. Now, there is a whole community without access to a supercenter, and they need to shop at the bodegas and liquor stores.
The wicked part of this plan is that the government that put it in place can declare that it reduced crime! They increased crime but made so many crimes "legal" that the number of crimes dropped.
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