America's Strangest Taxes
Consider the iconic New York bagel: decide to have yours toasted, and it’ll come with a tax. The rationale is that sliced bagels are usually consumed on a café or store’s premises—and restaurant meals are taxed, whereas groceries (like a dozen unsliced bagels) are not.
State governments can be remarkably efficient when it comes to finding creative ways to pick up extra cash, and some of their esoteric taxes affect tourists as well as residents. Whether it’s a tax on a hot-air balloon ride over the plains of Kansas or a lid for a coffee cup sold in Colorado, these strange fees won’t inflict serious damage on your wallet. But they will make you say, “Huh?”
Of course, the United States doesn’t have the monopoly on questionable tax laws. England and Russia once both levied beard taxes, and until 1997 German companies were permitted to write off bribes. Even cow flatulence isn’t safe: in the European Union, farmers pay between $18 and $110 per cow to help offset the methane gas each animal produces, despite the fervent protests of livestock groups.
Pennsylvania has an air tax of its own—for the use of coin-operated vacuum vending machines found at car washes. It’s enough to bring to mind the Beatles song “Taxman”: “If you drive a car, I’ll tax the street; if you try to sit, I’ll tax your seat; if you get too cold, I’ll tax the heat; if you take a walk, I’ll tax your feet.”
Find out what other taxes we uncovered from coast to coast. While at times befuddling and nitpicky, these taxes also remind us that each state is its own quirky destination, and the revenues should help keep them that way.
Blueberry Tax, Maine
In Maine, blueberries are big business: the Vacationland State produces 99 percent of our nation’s blueberries, averaging 80 to 85 million pounds per year. If you enjoy some this summer, count on being taxed. Anyone “growing, handling, processing, selling, or purchasing” the famous export must pay up, according to Maine’s state legislature.
Playing Card Tax, Alabama
While you can bet you’ll be taxed on gambling in many states, Alabama takes a particularly hard line. Buy a deck of playing cards—even for innocuous reasons like keeping the family amused on a road trip—and it comes with a tax of 10 cents per pack. If you consider the tax unjustified, here’s some perspective: sellers pay an additional $1 per pack. On second thought, however, that cost probably gets passed right on to you.
Vending Machine Fruit Tax, California
California is known for farmers’ markets, heavenly produce, and restaurants that have long championed what’s fresh and local. And while fresh fruit is duty free, the presliced variety of dubious origin sold in vending machines is not. If you’re somehow compelled to press the button, you’ll pay a staggering 33 percent tax—and honestly, you probably deserve it.
Coffee Lid Tax, Colorado
Order a latte to go from a Denver coffee shop, and you won’t have to pay an extra cent for the paper cup. But if you want a lid to prevent that hot liquid from spilling onto your pants (or, you know, burning your lap), that part of the container will be taxed. It turns out Colorado deems coffee lids and napkins to be “nonessential” packaging, which makes them subject to the state’s 2.9 percent tax.
Hot-Air Balloon Tax, Kansas
Unlike most amusement park rides, a hot-air balloon lets you linger high above the landscape and actually enjoy the view. But in Kansas, that luxury comes with a tax—unless the balloon isn’t tied down. Untethered, piloted balloons that travel some distance are considered a method of air transportation and so, thanks to the federal Anti-Head Tax Act, are exempt from the state’s amusement tax.
Tattoo, Piercing, and Electrolysis Tax, Arkansas
If you’re seeking a more permanent road-trip souvenir, Arkansas may not be the best state to get inked. As of 2005, all tattoos, body piercings, and even electrolysis hair-removal treatments are subject to Arkansas’s 6 percent sales tax. In retrospect, this makes a sort of sense: Arkansas is officially known as The Natural State.
Strip Club Admission Tax, Texas
Bring an extra five singles if you decide to scope out any of Texas’s 200 or so strip clubs. In 2011, club owners challenged the $5 “pole tax” passed in 2007, claiming it violated the right to free speech, but the court ruled it constitutional. The tax has so far raised more than $15 million—a portion of which funds sexual assault prevention programs.
Sliced Bagel Tax, New York
Bagels are a New York institution, but not all are taxed equally. Order yours cut in half or request it toasted or topped with cream cheese, and you’ll pay about 8 cents extra. Sliced bagels are usually consumed on a café or store’s premises—and in many states, restaurant meals are taxed, whereas groceries are not. (A loaf of sliced bread at a bakery comes tax free.)
No matter which state you visit, arrows will cost you. In 2012, the feds upped a long-standing excise tax on arrows. Now archery enthusiasts pay the Tax Man an additional 46 cents for arrows 18 inches or longer. Wooden arrows designed for kids are exempt, and the funds go toward wildlife restoration. (If you were wondering, bows are taxed at 11 percent.)
Air Tax, Pennsylvania
We swear this tax wasn’t implemented on April Fool’s Day. In the Keystone State, coin-operated vacuum vending machines are indeed subject to a “use” tax. So if you like to keep a clean car—or can’t wrap your head around paying a tax on oxygen and nitrogen—it makes sense to exit Pennsylvania before taking yours to the car wash.
Fur Tax, Minnesota
Sure, Minnesota winters are bone cold, yet local tax policy may make you think twice before bundling up in furs. All businesses in the state must pay a 6.5 percent tax on the sale of fur items such as coats and hats, and this fee gets passed directly on to tourists and locals alike. The tax also applies to the cost of shipping fur—so even out-of-staters have to ante up.
Goggles, New York
Whether shopping in Manhattan or upstate, remember that $110 is the magic number. All items below this amount fly under Uncle Sam’s radar, unless you’re in the market for sports attire, which is subject to some quirky exceptions. Goggles, for instance, are taxable (unless they’re prescription), but bicycle gloves and sweatbands are not.
Fountain Soda Tax, Chicago
Soda taxes are now as ubiquitous as sin taxes on alcohol and tobacco—33 states levy them. But in the city of Chicago, the rate you’ll cough up for your favorite syrupy beverage depends entirely on how you consume it. Bottled “pop” is taxed at 3 percent, while Coke and Pepsi lovers alike shell out 9 percent if they buy soda from a fountain, thanks to Chi-Town’s tax.
Fortune-Telling Tax, Texas
In Texas, ordinary “personal services” such as laundering, dry cleaning, and carpet cleaning are subject to sales tax, as are “amusement services.” Take a second look at the Lone Star State’s government website, and you’ll notice the list of taxable services gets oddly specific. Fortune-telling, for instance, is called out (as are services rendered by Turkish baths and escort services).
Haunted House Tax, New York
Boo! Now give me your money. In New York State, haunted house ticket prices can’t avoid the tax bogeyman. “While an admission charge for just a dramatic or musical performance is not subject to sales tax,” the state tax department states, “a haunted house is not exempted and is taxed as a place of amusement. That’s the case even if the haunted house also provides musical entertainment.” Okay, then.
Sparklers Tax, West Virginia
If you’re spending the Fourth of July in West Virginia, the good news is that sparklers are legal. The bad news (for retailers, anyway) is that businesses wishing to carry them must pay a tax for a Certificate to Sell Sparklers and Novelties each year. The best part about this law: it specifically references novelties like glow-worms, a favorite toy of many born in the ’80s.
Graphic Novel Tax, New York
Careful when browsing in a New York’s bookstore—the amount you’ll pay depends on the items in your shopping basket. Graphic novels, for example, are taxed, but most comic books are not. The rationale? New York State considers graphic novels like Art Spiegelman’s Maus to be books (fair game) and comic books to be periodicals (exempt)—as long as they’re published at least four times a year.
Yoga Tax, Missouri
In 2012, New York residents fought off a proposed tax on yoga classes and studio memberships, but yoga enthusiasts in Missouri haven’t been so lucky. The state charges a 4 percent sales tax for the privilege of centering oneself, but the law may soon change. In early 2013, Eric Burlison, a Missouri state representative, filed a bill to exempt fitness and yoga classes from the entertainment tax.
Candy Tax, Illinois
Whoppers and gummy worms: both candy, right? Wrong—at least in Illinois. According to state legislators, whether or not a treat can be classified as candy depends on whether it contains a single arbitrary ingredient. Because Whoppers contain flour, they’re exempt from Illinois’s 6.25 percent candy tax. (Sorry, gummy-worm fans.)
Belt-Buckle Tax, Texas
If you’re thinking of picking up a rhinestone belt-buckle souvenir to commemorate your Texas travels, know this: belts are tax exempt, while belt buckles are not. If you still want to get your cowboy on, take heart! Cowboy boots remain free from the tax man’s clutches.
General Tax, Hawaii
We’re not being facetious: in Hawaii, tourists and residents are at the mercy of the General Excise Tax. Regarded by locals as “the price of living in paradise,” the GET collects 4 percent on most goods and services—even necessities like toothpaste. The tax applies to businesses, but Hawaii explicitly permits retailers and service providers to pass the cost on to customers.
Vacation Sweepstakes Tax
Finally realized your lifelong dream of being a winning contestant on The Price Is Right? Before you celebrate, keep in mind that the value of all contest winnings is taxed at the same rate as income earned from working. Vacation prizes are subject to additional taxes, too, like the port tax for cruises and room taxes for hotel stays.