Tuesday, June 10, 2008

Taxes and Distortions

A recent post of mine over on the Blog at Mises.org.

Taxes and Distortions

Taxation distorts more than the economy, it distorts all aspects of human action. Consider the young man at my door yesterday.

As happens every so often, someone arrives at my door to sell candy for some never-quite-identified nonprofit organization. Now, I'm after the candy, the cause -- legit or otherwise -- is not my concern.

I heard the knock and opened. Before me stood this young man with a large box of candy and the identification card I know so well.

After the young man finished his pitch, I asked the price of the candy. Taken aback, he replies, "Oh, we don't sell candy. But, for an $8 donation, we offer one of these party bags of candy as a token of our appreciation." Hmmm.

OK, so with a wink and a nudge we align the verbal aspects of our trade in a manner that does not result in sales tax. I donate; he appreciates. With that, I bid him farewell, closed the door, and opened the bag of ten, individual-sized M&M packages. A sweet afternoon indeed..

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