Last week commander-in-thief president Obama proposed a $10 per barrel tax on oil. Finally someone’s gonna make big oil pay up and force them to share those juicy profits they’re stashing away in the Caymans, right? I knew Obama could be counted on to get the 1%! He’s the best president ever. Now all we need is Bernie Sanders 2016 to tax the banks and hedge funds. Then we can get tons of free sh*t from government.

Said idiotic worldview is extremely prevalent amongst voters in the developed world. Possibly nowhere more so than in the United States. People have been screaming for this for years. When I was lecturing at an American University, students would say things like this whenever they were given the opportunity. They were wildly lauded for it by their fellow classmates and all professors (apart from me). So we all know where such views come from.

But why are they wrong and who really pays taxes?

 

 

A TAX ON A THING IS A TAX ON YOU

You can tax companies and their products all you want but all you’re really doing is tax yourself. Companies have their profit margins to maintain. Without profits, nothing gets produced, no one gets paid, there’s no investment and no surplus to spend on innovation. The same principle apply in any industry. Levy a 10% tax on hamburgers and once the effect of this starts eating away at Burger King’s profits, they’ll be forced to raise prices in one way or another. Ultimately customers will always pay for any tax on a company or the product they make.

oiltaxisataxonyouWith oil, seeing as it’s used in the production of so many of products and in the transportation of all of them, this hits more or less everyone. Even if you don’t own a car, the things you eat are likely transported using one.

The people egging such tax increases on are in essence begging government to reach its thieving hand deeper into their pockets

This is one of the primary reason why, despite all our technological labor saving productivity raising improvements over the past decades, our purchasing power doesn’t seem to ever go up. The more stealth taxes such as this oil tax that are implemented, the less able companies are to pass their savings on to you in the form of lower prices. A tax can masquerade as penalty on someone or something else all it wants.

That doesn’t change the fact that a barrel of oil is no more capable of paying it than it is of flying like a bird. Things and companies don’t pay taxes. Consumers do! Obama, the thief that he is, is fully aware of this. Too bad the people he rob is not.

 

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  • PeteyBrian

    A gallon of regular gasoline in the United States is $1.75 per gallon nationally per AAA as of today.

    The gas tax in question will amount to up to $0.25 per gallon for the consumer – per your link.

    Not a burdensome user tax on Americans.

    What’s the price of a gallon of gas in the Ukraine?

    • “Not a burdensome user tax on Americans”

      If you just use 1 gallon per day, that’s $0.25 * 365 = $91 (per American) That’s an extremely low estimate. So I can come to your house once a year and take $100 on the grounds that it shouldn’t be a worry burdensome user tax on you?

      This is a cataclysmic heist of gargantuan proportions when you consider how much this will amount to annually. Americans use an average of 374 million gallons per day!

      https://www.eia.gov/tools/faqs/faq.cfm?id=23&t=10

      About price in Ukraine, i don’t drive a car and don’t see the relevance.

      • PeteyBrian

        If the tax monies – weren’t for a useful purpose (climate change) – you would be correct.

        If one thinks climate change is not real – like most Conservatives – then skip the rest of this post. Lol.

        These monies will be used for issues regarding climate change, clean energy, efficient transportation technology (autonomous cars and high-speed rail) and technologies focused on reducing emissions from the current U.S. transportation system.

        No one wants the world to look like Beijing, China!

        Gasoline is $3.24 per gallon in Kiev, Ukraine as of late January 2016. Irrelevant? Maybe – but Ukrainians pay $1.49 more per gallon than Americans – WITHOUT a tax…

        My point is Americans HAVE access to cheap gas compared to countries of the free world such that $0.25 cents per gallon is not a big deal.

  • Dirty Dave

    This is exactly how they want you to see it. “Not a burdensome user tax on Americans” Sure, when oil is 30$ a barrel it’s not a big deal right? What happens when oil goes to $60, or even $100+ again? How burdensome is it then? Climate change is an issue, but don’t think for a second that Obama is trying to institute this tax as part of a green initiative. It’s just an other opportunity to add another tax on US citizens when the risk of outrage is low. If climate change is a priority, then why didn’t the tax get issued sooner? Just 2 years ago oil was $103 a barrel. Do you think this tax would have any chance of passing then? Currently the United States federal excise tax on gasoline is 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel.[1][2]
    On average, as of January 2016, state and local taxes add 29.6 cents to
    gasoline and 29.38 cents to diesel, for a total US average fuel tax of 48.68 cents per gallon for gas and 54.40 cents per gallon for diesel. (ref Wkipedia) The point I think Mr. Baldr is trying to make is, that this is an opportunistic tax grab on Joe consumer, and the tax will be paid by consumers, not oil companies. If the previous post is correct in that the tax would add .25 cents per gallon more tax, and the average cost per gallon today is 1.75… this means that at current prices, your tax percentage per gallon would increase from 25% to 37% per gallon. Politicians are keen on adding taxes when it’s no big deal… when was the last time any taxes decreased??? Politicians will always seize the opportunity to increase taxes, no matter what the justification.

    • Well said, and yes, because liberals continue to argue that the legality of theft depends upon how much is stolen at a time, you get these furry of mini-heists that add up to Trillions annually.

    • PeteyBrian

      Math on the tax increase would be 14%.

      In the USA, the effective tax on the wealthy is very low – Buffet Rule (effective tax rate around 10%). Long term capital gains tax dropped from 20% to 15% during Bush administration among other tax reductions.

      I’m all for tax cuts on working class Americans – who are heavily taxed and have little representation in the US government. If you work in America – you are screwed on a tax percentage basis…

  • Kiri11

    Why do you care so much about the USA?

    • It’s the only country ever founded on classical liberal ideas. As I am a classical liberal, I look upon America as the role model for how a country should be run or at least as close as any country has come. We’re talking 19th century America here so it’s a long time ago. Today it’s pretty much the opposite.

      As it’s still the nation where more people understand these ideas than any other, I’m hopeful things can take a turn for the better. Look at guys like Ted Cruz and Rand Paul. Both hardcore classical liberals. In no other country is it possible to come so close to power with such ideas on individual freedom. USA remains the last bastion of gun rights and freedom of speech. It’s mankind’s last hope for freedom in my time.

      • Kiri11

        Fair enough.

        I’ve seen many people from US with opinions similar to yours. And even more with exactly the opposite.

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