[simoneaugie]

The taxes on cigarettes and gasoline are so high here in Washington State. Receipts don't list the tax amount. Can I write off the tax somehow in my income taxes?

[wnhough]

QUOTE," Can I write off the tax somehow in my income taxes? "---Just for your personal consumpetion? Sorry, No. You, as an employee, may claim deductible cost of gas( not tobacco) regardless of whether the standard rate or the acutal expense method of reporting is used. As a self-employer, you , on line 9 of Sch C , can deduct your gas espense for your vehicle.

[simoneaugie]

Wow, so when we buy gas or nicotine products we are paying tax with taxed income. How can that be legal?

[wnhough]

QUOTE,"How can that be legal?"---It is absolutely LEGAL; The US Tax code says so. As many tax experts or taxation instructors state,Tax code, as you can see, doesn't have to be entirely logical or rational( though as we know, there are many court cases out there). One of the fundamental purposes of taxation not only in the US but even in other societies is to provide incentives for certain business and economi goals, such as higher employment rates, through business-favorable tax provisions or to increase government revenue to effectively operate the government for realizing ultimate goals. As an illustration,excise taxes are often pledged for certain purposes. For example, a fuel excise is often used to pay for public transportation, especially roads and bridges and for the protection of the environment. Excises (or exemptions from them) are also used to modify consumption patterns. For example, a high alcohol or tobacco excise is used to discourage alcohol and tobacco consumption, relative to other goods.

[simoneaugie]

Before WA changed its car licensing law, they listed the tax on license tabs as excise tax. I found out that it was not and was able to write it off on my income tax.

How does that work? They mislabel something to increase revenues?

If the government really wanted to use something to create revenue, why don't they tax sugar and everything made with it?

Thanks for your help. I'm just thinking aloud.

[wnhough]

I bet your question contains both ethical, economical , functional and even philosophical significance on legality of excise taxation in the US; as you can see,excise taxes( like other regular form of taxation) are one way for governments( both Fed and state level govts.) to raise the funds needed to provide services as mentioned above. Howevr, I believe that the problem with excise taxes is that they can be imposed for other purposes as well. One other use of excise taxes is to protect special interest groups from competition. But this sortof taxation related situation is not very new, it is usual. Another use is to alter behavior, to dissuade individuals from consuming politically incorrect substances like cigarette and alcohol, or to punish them with punitive tax rates if they do.

[ebaines]

Wow, so when we buy gas or nicotine products we are paying tax with taxed income. How can that be legal?

If you think that "double taxation" is somehow illegal - think again. There is no law that says it is illegal, and there are many examples of it in the tax coode. Some examples:

1. You can deduct state income tax on your federal return, but only if (a) you don't write off your sales tax, and (b) you don't get caught up in the Alternative Minimum Tax (AMT).

2. Excise taxes and highway tolls are generally not deductible. It's not just taxes on beer and cigaretes, but also gasoline and telephone usage (the excise tax on telephone usage was initially implemented to help defray the cost of the Spanish american war).

3. Social security and Medicare taxes are not deductible.

4. You pay taxes on dividends received, even though the corporation that you're getting the dividend from is paying income tax on their profits.

[AtlantaTaxExpert]

What ebaines has so eloquently states is that taxation is NOT fair, and that you should NOT expect it to be fair.

However, that does NOT mean that the taxes are not LEGAL. Almost without a doubt, they ARE legal.

In the rare cases when the courts have ruled certain taxes to be illegal (as happened in New York City when its commuter tax was deemed illegal by the federal courts), the courts normally refused to make the ruling retroactive, which meant that collection of the "illegal" taxes for prior years were allowed to stand (less it cause financial chaos for the tax authority who collected the taxes in good faith, beliving that the tax being collected was at face value legal).

[simoneaugie]

Is there anything the typical consumer can do other than provide a single vote to say, "hey, what's with that?"

Are those who "control or cause" these taxes to become the norm able to benefit from the unfairness?

I realize that the whole thing is extremely complex. But, how can I be proud to be an American? The complexity is part of the system; does it have to cause the pursuit of happiness to be subject to no perceptible choices if a person is not financially well off?

There are so many of us pawns funding the direction (decision makers) and availability of money. Those pawns seem to have so little imput. They are also frequently and unfairly categorized into a single cupboard of entitlement attitude.

Nah, it isn't fair. Life isn't. I don't think our current system is what the founding fathers had in mind at all though.

[AtlantaTaxExpert]

Time for my periodic rant:

I have heard the quotation that "This is not what the founding fathers had in mind" more times than I care to think about.

But when you think about it, that phrase really has no meaning, because there is NO WAY ANY of the Founding Fathers could have conceived of the complexity of the modern world.

However, they DID provide methods by which we could modify the system to meet the needs of the modern world, and, for the most part, those methods WORK!