Saturday, May 14, 2011

How much do things cost: Taxed on the taxes.



I went to the store today to buy a widget.  The price was $3.28.  I decided that was too much to pay and came home and looked on the internet.  I found the company that makes this widget and after several hours of scouring the reports and white papers on this widget, I learned that the cost to manufacture the item was .0475.

I was livid until I saw the company records.  They made a profit, quite a bit of profit as a matter of fact.  About 3000% profit.  But that is not the entire story.  If 3000% was not bad enough, the cost for packaging, boxing, transporting, and ancillary costs to the process is another $1.17.  Combined the entire cost from start through the sales is $2.7175.   That does not explain the other .56.   

There is a State fee on transportation, a green fee on development, a federal fee for waste, a state fee for waste disposal, a federal processing assessment (F.P.A.), a federal highway transportation fee, a federal and state packaging fee disposal assessment, and a national sales assessmnent fee.  Total, those fees and assessments equal 56 cents.

The item I held cost 4 cents and the fees were over 56 cents.

Then came the tax.  Los Angeles county tax and state tax.

(Even assuming the profit of $1.50 plus the .0475 cost and rounding that up to 5 cents, would give us $1.55 before tax, but no, the fees and assessments are more than the item.)


When it was done, the total charge was $3.84 for the item that cost .0475 to produce.













fees

Make Mine Freedom - 1948


American Form of Government

Who's on First? Certainly isn't the Euro.