News › Taxand’s Take Article
The global financial crisis and the ensuing deficits being faced by a number of governments across the world has given rise to a number of extraneous and peculiar taxes, some of which have undoubtedly been implemented as a means to plugging holes in public finances.
Here we take a look at some of the stranger taxes we have come across:
- Death Tax - Local laws in the New Brunswick in the US enforce funeral taxes upon the death of an individual. The UK was also considering a scheme along these lines to pay for free home and residential care for older people.
- Mooncake Tax - The Chinese government has proposed collecting taxes on mooncake coupons for the Mid-Autumn Festival. Mooncakes are a Chinese pastry associated with the full moon celebration.
- Plastic Bag Tax - Earlier this year, Colombia in the US introduced an excise tax on the retail use of plastic bags in particular circumstances. Ireland, the first nation to tax plastic bags, doubled their rate late last year.
- Snow Tax - Proposals have been made across UK councils for additional council tax to be added bills to pay for gritting and repairing pot holes, associated to snowfall. Similar proposals have been made in France and Spain.
- Litter Tax - There has been numerous proposals across the globe for taxes on plastic bags, chewing gum etc.
- Bottled Water Tax - Chicago was the first city to approve a tax on bottled water. Washington has also proposed a state sales tax on bottled water.
- Cow flatulence - Taxes on cow flatulence have been proposed in several European countries in recent years, including Ireland and Denmark.
- Tattoo Tax - Anyone getting a tattoo, body piercing or even electrolysis treatment in Arkansas, US has to pay an additional 6% tax.
- Local Service Taxes - As income taxes have come down over the past few years, Switzerland has introduced increased taxes on local services such as water supply, refuse and drainage.
- Sweet Taxes - In Finland, taxes on sweets and ice-cream products are being re-introduced while taxes on soft drinks are also being tightened.
- Dog Tax - In the Ukraine higher taxes are levied on owners of larger dogs. The tax brackets are defined by small, medium and large dogs and high taxes are also levied on dogs of "aggressive" breeds, regardless of size.
We've all heard of VAT, Real Estate Tax, Transfer Pricing...but these tax oddities take the biscuit...or mooncake should we say. So, what are the governments that enforce this legislation trying to achieve? Are they really another means of clawing back revenue to counter current country deficits? Or are they actually a drive to change consumer behaviour so we, for instance, make the environmentally friendly decision to re-use plastic shopping bags, or even better use our own?
Whilst multinationals focus on maximising their tax efficiencies and operations globally in an effort to minimise the impact of the global financial crisis, it's worth bearing in mind that businesses will need to consider the effect of, what can only be deemed as bizarre legislation, when operating in these jurisdictions to ensure they comply.
If you know of any other weird and wonderful taxes we'd love to hear them. Email us at email@example.com with your insights.