How Much Taxation is Too Much Taxation?

Many citizens of the United States may have been wondering why do we pay taxes on our income, and then have to pay taxes on items that we purchase with that income? At what point will the Federal and State Governments determine that the people have been taxed enough? Is there even such a thing as being over-taxed?

We are Taxed on Airline Tickets

On August 5, 2011, the IRS announced that Congress has reinstated the Airline Ticket Taxes and apparently there was a lapse in the Federal Aviation Administration ("FAA") authorization because it states that this authorization will apply "retroactively" to the airline ticket taxes for passengers who traveled during the lapse of the FAA's authorization. As a result of the bill Congress passed, passengers who purchased tickets prior to July 23, 2011 and traveled between July 23 and August 5, 2011, are not entitled to a refund of the airline ticket excise tax. Additionally, the IRS intends to provide relief for passengers and airlines with respect to ticket taxes that were not paid or collected because of the lapse. Makes you wonder how many people actually noticed the additional fee labeled as "federal taxes" on their receipts. As if airline tickets were not expensive enough. So not only do we have to pay to check in our bags, we pay more federal taxes.

We Pay Taxes on Goods and Services

Now not only do we pay taxes to the federal government, but some of us pay income taxes to the state. Well if that was not enough, some states also imposed a sales or use tax on goods purchased by consumers. At least 45 states impose sales and use taxes on the retail sale, lease and rental of many goods, as well as some services. Many cities, counties, transit authorities and special purpose districts impose additional local sales or use taxes. A sales tax is collected by the seller at the time of sale, while a use tax is self-assessed by a buyer who has not paid sales tax on a taxable purchase. Luckily for consumers, there is no Federal sales or use tax.

We Pay Estate and Gift Taxes (Also called Inheritance Tax)

The Estate Tax is a tax imposed by the Federal Government and states against the "taxable estate" of a deceased individual. A Gift Tax is a tax placed on taxable gifts such as a transfer of an estate as a gift from one individual to another. So individuals who receive an inheritance, proceeds from a life insurance, or property, etc, from a living or deceased person is subject to this form of taxation. So not only will the Federal Government tax the estate or gift, so will the state. Is this form of double taxation fair?

We Also Pay Property Taxes

So not only do individuals pay taxes on the income they receive, they in turn must use that income to pay taxes on any taxable property owned as determined by most states. Property includes both real and personal property. So we are subject to taxes for the houses, land, and vehicles, etc. that we may own even though we likely paid taxes on the items when we first purchased them. These taxes are often paid annually.

These are just a few examples of the type of taxes that citizens of the United States may face, and there may be others not listed. At what point will the Federal Government and states realize that individuals are over-taxed? We are taxed on our income, then taxed on the items we purchase with that income. Is this the type of power we gave to our government, and if so, how do we take it back? The Federal and State Governments may issue refunds each year to those who may qualify, but it hardly compensates us for the taxes that we pay on a daily and annual basis. Yet despite paying these taxes, our economy is still declining. How much more would consumers purchase and revive this economy if their income were left untaxed?

What do you think, are we over-taxed here in the United States?

Reference

http://www.irs.gov