Tuesday, November 11, 2008

Blog To Be Named Later

Have you ever stopped to consider how much we are taxed in America? We work and get paid for working. That pay is taxed. Federal Income Tax, State Income Tax, and in some cases, Local taxes. Then we take our meager remainder after taxes and pay our every day living expenses. Housing, utilities, medical, groceries, etc. Many if not all of these expenses are taxed separately. We pay sales tax at the grocery store when we spend our already taxed money for groceries and other items we need for our homes and families. We buy a car, we pay sales tax and use tax, sometimes exise tax. It depends where you live as to the amount of taxes you are subject to.

Many generations ago, there was a revolution to protest "taxation without representation". Now we have taxation WITH representation. The representation by our elected officials who set up laws that determine how much tax we are to pay, and on what, and to whom.

All this was instigated by my wondering why, when I pay tax on the materials and supplies that I buy to make my jewelry and accessories, do I have to charge and then pay tax on anything I sell to residents of my state. Didn't I already pay tax on the components of the item that I created and then sold? If you think about it, when I buy supplies at say, my local Michaels, I pay 8% sales tax on my purchases. Then, when I sell it to someone in my state, I have to charge them 7% sales tax, and then file and submit that tax to the state. So isn't that like taxing the same thing twice? Oh, I know that the tax is based on my sell price, and the tax I already paid was on the cost of the components. So shouldn't the tax on the sold item be the difference? Take for instance, I sell something for $1, which consists of materials that cost me 35 cents. The tax on the 35 cents was based on the cost of the materials, so shouldn't the tax I charge on the completed item be on the amount that is the difference of the sell price and the materials cost? I doubt it works that way but it sure is something to think about.

Next thing ya know, blogs will be taxed under Entertainment Tax!

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