Hidden taxes you pay every day

By Judi Hasson

Everyone knows there are federal taxes on tobacco and alcohol, but did you know the feds take a bite out of your afternoon candy bar?

There are plenty of unexpected taxes that raise the price of goods and services -- sin taxes, import duties, user fees and excise taxes on everything from gas guzzlers and firearms to communications services and air travel.

"The less visible a tax is, the less likely taxpayers will be aware of it, unsettled by it and advocate against it," says economist Jared Bernstein of the Economic Policy Institute in Washington, D.C.

You may feel lucky in Las Vegas, hit the lottery or have a good day at the racetrack, but all winnings are taxable as regular income.

There's a tax on the life insurance policy that your employer so generously gives you as a benefit if it is over $50,000.

"Most of the hidden taxes pertain to products we buy rather than wages we earn," adds Pete Sepp, a spokesman for the National Taxpayers Union, a watchdog group in Washington, D.C.

America first

Goods from brooms to bicycles may carry excise taxes to make them more expensive. It's one way the government keeps the price of imported products artificially high and makes it easier for domestic ones to compete for business.

"You are paying more than you would otherwise pay," says Patrick Fleenor, an economist for the Tax Foundation, a Washington, D.C., group.

Here are some items whose prices are jacked up with import taxes:

Taxes on imported goods
Bicycles	11%	Cotton hammocks	15%
Certain infant formulas	18%	Table linens	12%
Flashlights	18%	Peanut butter	143%
Girdles and panty girdles	24%	Telephones	8%
Brooms	32%	Plastic school supplies	5%

Source: Institute for Policy Innovation, Washington, D.C.

Your candy bar offers a good example of how import taxes, or duties, can inflate the price of sweets. Congress has used tariffs and subsidies to manipulate the market price of goods and produce to benefit American producers.

These costs are sprinkled over many different products, such as candy, breakfast cereal and other packaged food on the grocery shelf.

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"Who pays for these subsidies? All of us do -- when we pay our taxes that are used to pay the subsidies to domestic producers and when we purchase a Milky Way as a midafternoon pick-me-up," says Andy Pike, a tax professor at American University's law school.

A recent government report estimates that consumers pay between $400 million and $1.9 billion a year to fatten the sugar industry with federal subsidies and artificially inflated prices.

Continued: Hidden taxes are everywhere

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