April 9, 2012 -- Strange, unlikely, surreal: Take the tax codes of the 50 states, apply a magnifying glass, and here and there, hiding amongst the small print, are specimens that would amaze P.T. Barnum:
A tax on fur, a tax on nudity; taxes on bagels (if sliced, but not if intact); on salt, pets, tattoos; on blueberries, on candy (if not containing flour), on illegal drugs, on sparklers, septic tanks and playing cards. Californians don't pay tax on fresh fruit--unless, per chance, they buy their banana from a vending machine.
New tax marvels are being born daily. New York tax expert Barbara Weltman, publisher of "Big Ideas for Small Business," points to one new one, imposed by Mississippi on salt produced from that state's lands or waters (3 percent of the value produced).
"Unique, weird taxes are states' creative ways to increase revenue in a way consistent with their population and products," she says. Some oddities arise from the circumstances of the moment: The feds, for example, have begun taxing arrows and other "archery products"--an innovation she suspects has arisen in light of the popularity of "The Hunger Games."
Ladies and gentlemen, we present below, for your delectation and amusement--for the first time on any stage--the wildest taxes levied by the 50 states, some supplied by Weltman, some coaxed from states' websites, and others found by eFile, GoBanking, TurboTax/Intuit and the Corporate Tax Network.
Blueberries: They're a big deal in Maine, which produces all but 1 percent of the wild ones sold nationally. Maine taxes them every which way: Anyone growing, handling, processing, selling or purchasing blueberries pays a tax of a penny-and-a-half per pound.
Fur: Come the day your Davy Crocket cap finally wears out, best not buy its replacement in Minnesota, which imposes a tax of 6.5 percent on the sale of fur apparel. How much fur must it bear? Your hat or coat or mukluk must contain at least three times as much fur as it does of the next-most-valuable material that went into its construction. The same tax applies to the shipping of fur items and to any finance charges that may have been incurred.
Nudity: You'd think that Utah, being one of the more circumspect states, would have less nudity to tax than, say, would Nevada. No matter, the civic fathers (and mothers) of Utah levy a tax on services provided by the unclothed. A jiggle parlor, for example, or any other business employing "nude or partially nude" workers, must pay a tax of 10 percent on services sold to patrons (surely patrons from out of state—probably Nevada). If the workers are wearing fur from Minnesota, that would complicate the situation.
Tattoos: Arkansas doesn't just tax tattoos (6 percent of sales). The Natural State applies the same tax to body piercings and electrolysis. So, if you need to have your hair removed before applying for a job as an exotic dancer in Utah, don't have it done in Arkansas.
Playing Cards: In Alabama, your purchase of a deck of playing cards will be subject to a tax of 10 cents per pack. The seller, though, pays $1, plus another $3 for a license. If all that you'll be playing is a friendly, noncommercial game of 52-Card Pickup, don't expect an exemption: the tax applies to all decks of 54 cards or fewer, no matter what their purpose.
Candy, Sodas: Illinois applies to candy a surcharge of 5 percent over and above its 1.25 percent sales tax on food. But candy isn't candy—at least not for tax purposes—if it contains flour. Malted milk balls thus would be exempt, wax mustaches would not. In Chicago, a soda served from a soda fountain is taxed 9 percent; the same soda drunk from a bottle or a can is taxed 3 percent
Litigation: New York taxes litigation, which makes sense, since so much of it is manufactured here. Newcastle taxed coal. Any New Yorker involved in criminal or civil proceedings pays a flat $25.
Bagels, Pets: In Durham, North Carolina, residents who own a cat or dog must pay tax, since the state considers pets to be personal property no different from, say, a TV or stereo—though there would be a difference if a stereo or TV could be neutered. The tax on spayed or neutered pets is $10. But on animals intact, it is $75. This is the reverse of New York's bagel tax, which applies an eight cent charge to altered bagels (ones sliced and schmeered) but not to ones uncut.
Balloon Rides: Kansas wisely distinguishes between tethered balloons and balloons set free. The latter, says efile.com, "are considered a legitimate form of air transportation." Thus rides in the former are taxed as amusements, rides in the latter are not.
In Pennsylvania--as in every other state--there's a tax on alcohol. But Pennsylvania's tax arose as a response to the devastating Johnstown flood, which killed several thousand people in the 19th century. A follow-up flood in '36 did more damage. The state imposed a tax on alcohol to raise money to rebuild the city, and in 1942 rebuilding was complete. Yet the tax remains, picking Pennsylvanians' pockets of $200 million annually.
Be careful what you wish for? Yes. But be careful what you tax. Silly or otherwise, taxes are forever.