Unavoidable Hidden Tax

Last Revised on November 10, 2007

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Tax filing season is over, but not the tax itself. Tax season is continuous. Tax is everywhere, whether you wanna smoke a cigarette or eat a healthy food. There are also taxes that we know of like income tax, and there are so may taxes that we are not aware of. These are known as hidden tax. More people worry about income tax than about small taxes that we pay when we buy things. But keep in mind that government put far more hidden taxes on products we buy than on salaries and wages we earn.

Here are the list of hidden tax that most of us never cared to learn about:
* Betting Might Be Legal in some field, but it won’t let you off the tax system. When people bet legally in casinos and gambling places, there’s a 25-cent tax on every bet that has been place..

* Scholarship is not Free, people: There are federal taxes on some parts of the award. Room, board and pocket money are taxable, but tuition is not.

* Federal tax on a pack of cigarettes is 39 cents, but there are lots of unavoidable state and local taxes on its way to final price.

* Hidden Tax that comes with Flight fee: a 7.5% tax on a domestic flight ticket, a $3 tax for each segment of a flight and, since the Sept. 11 terrorist attacks, a $2.50 security charge on every segment.

* Fishing and Archery Is Not Free: A fisherman pays 10% of the sales price on sport-fishing equipment. Nor is archery. The federal tax on arrows is 40 cents per shaft.

* This is hilarious: A childhood DPT vaccine (diphtheria, pertussis, tetanus) has a 75-cent charge per shot for a trust fund for those injured by the shot.

* Bankruptcy Is Not a Solution for hidden Tax: You maybe so broke that lenders and creditors let you not pay back part of your debt, but the forgiven portion of your debt is considered “income” and taxable for that reason.

So what’s the ultimate hidden that we don’t know of: value-added tax, VAT, is tax that each time a business handles a product from start to finish, the businesses pays a tax on the increased value. In the end, all those taxes are reflected in the retail price of a good or service. That makes a VAT the ultimate hidden tax since.

An Important Tip About Tax: If you take a bribe or steal something, the value of that bribery or stolen product is considered as part of your annual income if not returned back by the tax season.

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