Tag Archives: business

Taxes: The Bad, The Ugly and the Absolutely Moronic

Russia's Peter the Great, 1672 - 1725

Russia's Peter the Great, 1672 - 1725

Fun Facts About Dumb, Annoying, Crazy or otherwise Controversial TAXES

BeardBeard Tax

To Shave or Not to Shave? Peter the Great taxed all (non-clergy) facial hair in 1705. As much as 90% of Peter the Great’s tax revenue used for military. (also taxed souls)

Facial Hair Tax

Massachusetts has a law on the books that makes it illegal to have a goatee without first purchasing a license to do so. A small fee must be paid in order to wear the facial hair in public, and one can be fined if a license is not presented to a law enforcement official upon request.

UrinalUrine Tax

Nero and Vespasian taxed collections from latrines. (used for textiles)

BribeBribe Tax

According to Page 87 of the IRS code, “if you receive a bribe, [you must] include it in your income.”

Mahatma GhandhiSalt Tax

Worth your weight in salt. 1930 Ghandhi’s first steps toward Indian Independence.

Ski Resort

Amusement Tax

In most states including Massachusetts and Virginia, is considered a tax on the patrons of places such as ski resorts, craft shows, and golf courses, but in reality is collected from the operators of such places. The government taxes the owners of places that offer “amusement” and in return those businesses pass the aforementioned taxes on to us.

Fountain sodaFountain Soda Drink Tax

Illinois has on record a tax rate on fountain drinks of 9 percent, as opposed to the standard sales tax of 3 percent.

Chinese take outTake-out Tax

Little did you know some areas levy a 0.5 percent tax on all take-out food. Chicago and Washington, D.C. both have enacted a tax on fast food, purportedly to pay for the removal of litter often accrued with the purchase of burgers and dogs. This tax applies to everything take-out, from your morning egg McMuffin to your late night cheese steak.

BlueberriesBlueberry Tax

In Maine, “anyone who grows, purchases, sells, handles, or processes the fruit in the state” makes those persons eligible for a ¾ cent per pound tax.

Playing cardsPlaying  Card Tax

Alabama has in place a 10 cent tax on the sale of all playing cards with 54 cards or less.

sparklerSparkler and Novelties Tax

West Virginia imposes a special fee on all businesses selling sparklers and other novelties. On top of the state’s 6 percent sales tax you can expect to pay an additional fee courtesy the state.

Illegal drugsIllegal Drug Tax

11 states in the U.S., including North Carolina and Nevada, tax citizens on possession of illegal drugs. After acquiring an illegal substance in North Carolina you are supposed to go to the Department of Revenue and pay a tax on it. In exchange, you will receive a stamp to affix to your drug which serves as evidence that a tax was paid.

NudityNudity Tax

In the State of Utah, taxpayers that own businesses where “nude or partially nude individuals perform any service” have to pay a 10% sales and use tax. It applies to all revenue from admission fees as well as the sales of merchandise, food, drink and services. These expenses are paid by the business owners who likely pass along the additional costs to their customers.

 

Special thanks to Huffington Post: A Dozen Dumb Taxes (from a compilation by Nick Sabloff)

Advertisements

Leave a comment

Filed under Criminal Justice, Economics, Entertainment, Food, Historical Events & Figures, Nature, Travel

OPEC: Influential Oil Producing Cartel with “Diplomatic Immunity”

OPEC Cartel Logo

OPEC Cartel Logo

Fun Facts About OPEC

Members of OPEC meet

Members of OPEC meet

 

 

Current Members: Algeria, Angola, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates, and Venezuela

Cartel: By definition, OPEC is a cartel — a group of producers which tries to restrict output in an effort to keep prices higher than the competitive level.

It no longer sets crude oil prices: OPEC admits to setting crude oil prices in the ‘70s and’ 80s — they would look ridiculous to try and deny it. However, the oil market underwent a transformation in the 1990s and today, prices for crude oil are established according to three markets: 1) The New York Mercantile Exchange; 2) The International Petroleum Exchange in London; and, 3) The Singapore International Monetary Exchange.

This isn’t to suggest that OPEC has no influence on prices; quite the contrary. Prices established by the exchanges are based on supply and demand; therefore any decision OPEC makes concerning restricting production, for example, will have some effect on prices. These decisions, however, can have a direct consequence on profit margin, so it isn’t always in their best interests.

Its practices are considered to be illegal: Simply put: Cartels are illegal in many countries. In the U.S., for example, OPEC is in direct violation of antitrust laws, such as the Sherman Antitrust Act of 1890 — the same act that broke up Standard Oil, American Tobacco and Ma Bell. Antitrust laws don’t criminalize monopolies per se, only if the monopoly is used to eliminate its competition through methods of production or price-fixing.

Ordinarily, U.S. antitrust laws explicitly prohibit dealing with cartels. What makes OPEC so special? Simple: Congress grants OPEC diplomatic immunity from prosecution and in essence treats it as though it were a sovereign nation, even though this is not remotely the case. This status was tested in 1978, when the International Association of Machinists and Aerospace Workers (IAM), a non-profit labor organization in the U.S., filed suit against OPEC under the Sherman Act. In 1981, the U.S. Ninth Circuit Court of Appeals rejected the case, claiming OPEC was protected by its sovereign immunity status.

In 2007, a pair of controversial bills were introduced in Congress designed to amend antitrust laws to include OPEC. If the measures are approved in both houses and the president doesn’t veto it, individuals harmed by OPEC in the U.S. can begin to sue the organization. If this were to happen, few expect OPEC to continue doing business with the U.S.

It isn’t the only game in town: If one only paid passing attention to the media, you might get the impression that OPEC is the only oil game in town. Granted, its member countries control anywhere from two-thirds to three-quarters of the world’s proven oil reserves and over 40% of the globe’s oil production; however, there are other sets of somewhat substantial oil-producing groups.

Originally formed as an agent of the Marshall Plan following World War II, the Organization for Economic Co-operation and Development (OECD) is a vast and all-encompassing organization with all sorts of arms and legs. Of its 30 member countries, a minority are oil producers, including the USA, Canada, Mexico, and the UK. Together they account for about 23% of the world’s oil production.

Additionally, the Russian Federation and a handful of former-Soviet states, such as Kazakhstan and Uzbekistan, are responsible for about 15% of global oil production.

OPEC Member Nations

OPEC Member Nations

It was formed to fight the “Seven Sisters”: The world’s wealthy oil barons have not always resided in the Middle East. In fact, for most of the 20th century, the member nations of OPEC were at the mercy of the so-called “Seven Sisters,” a non-organizational set of oil producers and distributors which, perhaps due to that non-organizational status, somehow eluded antitrust prosecution. The Seven Sisters was composed of Standard Oil of New Jersey, Royal Dutch Shell, Anglo-Persian Oil, Standard Oil of New York, Standard Oil of California, Gulf Oil, and Texaco.

By 1960, Iran, Iraq, Kuwait, Saudi Arabia, and Venezuela had grown tired of exporting their oil and then having to buy it back at higher prices. They formed OPEC to assert their “legitimate rights in an international oil market,” and by the 1970s, thanks in part to strategic maneuvers such as the Arab oil embargo, began to dominate the market.

It’s “customers” see bigger oil prices than its members: Oil taxes by countries that regularly import oil from OPEC, such as the U.S., the UK, Japan, and Italy, are often as much to blame for high oil prices as OPEC. Such taxes allow some countries to see oil-related revenues that are three or four times higher than some OPEC members see from exports. In addition, the production and development of oil requires huge investments, a fact that further chips away at OPEC-member profit margins.

As gasoline prices soar, more and more attention gets paid to OPEC. In the Western press its easily vilified and is a common ”fall guy“ for every issue related to oil and oil prices — not always unjustifiably so.

More than a few people would be pleased to see OPEC’s influence reduced or even made moribund. However, proven oil reserves are defined in the industry as the amount of oil that can be recovered and produced using today’s technologies, and as of 2006, the world total was 1,195,318 million barrels of crude oil; OPEC’s share of that amount was 922,482 million barrels or 77.2% (if you accept OPEC’s figures; hardly everyone does). Thus, unless a drastic change occurs in the energy-consumption habits of much of the world’s oil-hungry population, interest in OPEC is unlikely to recede for some time.

Special thanks to www.askmen.com

1 Comment

Filed under Economics, Historical Events & Figures