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moneysense.ca, 13/04/10
Fun Tax Facts
I’m reading The Elements of Investing by Burton Malkiel and Charles Ellis and stumbled upon some delightful examples of how people have arranged their affairs to avoid taxes in the past.
Tuscan Bread
“Centuries ago, when the Papal State dominated Tuscany, these rulers imposed an extremely high tax on salt. As a form of protest, Tuscan bakers began to make their bread without salt.
Gradually, the taste for bread made entirely without salt became widespread, and to this day, Tuscan bread is salt less”.
Narrow Houses of Amsterdam
“The narrowest house in Amsterdam is approximately 180cm wide, which is actually less than the height of the average Dutch person. Historically, property in Amsterdam was taxed based on the width, which is why many houses are so narrow and deep”.
Mansard Roof
“Property taxes were often levied on the number of rooms in a house, and therefore, rooms on the second and third floor were considered just as ratable as those on the ground floor. But if a mansard roof was constructed on the third floor, those rooms were considered to be part of an attic and not taxed”.
Sources:
florencevillas.com
Nile Guide to Amsterdam.
The Elements of Investing by Burton Malkiel and Charles Ellis. Here’s a graphic of a Mansard Roof.
moneysense.ca, 13/04/10
[...] This post was mentioned on Twitter by Canadian Capitalist. Canadian Capitalist said: New Blog Post: Fun Tax Facts http://bit.ly/9vq0iV [...]
Interesting – I would add to this list the guy who chooses not to look for work because he doesn’t want to stop his 56 weeks of Unemployment Insurance.
@Rob: Another example of how taxes influence behaviour is the treatment of interest on home equity loans as tax deductible in the US. It’s so much easier to justify to yourself that it’s okay to be in debt if the Government is sharing the interest burden.
.. and then there was the infamous UK window tax which caused people to brick up their windows! http://www.longparish.org.uk/history/windowtax.htm
Apparently, the curving outside staircases emblematic of housing in Montreal also emerged as a result of taxation.
There’s no shortage of these types of examples. The wealthy all claim their residency in the tax havens of the Caribbean to avoid taxes. Even corporations put their head offices in places like Jersey (in Europe) or Cayman Islands to avoid taxes.
I wonder whether we hate taxes more because of the level of taxation, or whether it’s due to the perception of government spending our money irresponsibly brought to light by countless spending scandals.
For example, health care accounts for our biggest government expenditures and is one of the highest per capita expenses in the world. If our health care system was actually the best in the world (to reflect our spending on it), I don’t think we would complain as much. But waiting lists for surgeries are atrocious, people like me can’t even find a family doctor and going to the hospital means sitting in a waiting room until you’re too pissed off and leave. Meanwhile every professional athlete, politician and wealthy person either jumps the queue or gets better service in some other country.
Governments will always find ways of taxing and people will always find ways of avoiding paying taxes… and endless cycle.
[...] Canadian Capitalist points out some Fun Tax Facts no wonder I don’t like salty [...]
[...] enjoy pointing out the unintended consequences of policy, and taxes are no exception. When the width of houses was taxed in Amsterdam, the houses became increasingly narrow. When windows were taxed in Great Britain, [...]