Government and Hidden Taxes: Hidden Taxes Increase The Cost of Government

To the extent that there are hidden taxes included within the prices government pays for the stuff it buys and consumes, (such as payroll related taxes, and taxes on business profits), these hidden taxes are forcing government to pay more for the stuff it needs to consume than would otherwise be needed.


These increased costs mean that government needs to receive more tax dollars just to pay the hidden taxes that are part of its purchases, just like consumers have to pay more for food and other basic necessities because of hidden taxes currently included in prices charge.

Yes, I just said that our current hidden tax system is also forcing government to pay the same hidden taxes that are being passed down to all other consumers.

As an example of this point, look back to part 4 of this eight-part series which had a business focus and which showed a more detailed example of the effect of the “markup”.  Any hidden taxes included in the prices government pays also results in a markup on those taxes, which forces government to pay more for the prices of the stuff it consumes than just the cost of the hidden taxes.

Replacing hidden taxes with transparent taxes would help to lower the cost of government because the prices government pays as a consumer would no longer include the cost of hidden taxes (plus the markup effect).  This means that government could either provide the same level of services currently provided using fewer tax dollars, or it could meet a higher level of need using the same amount of tax dollars currently being spent.

I wonder if anyone knows how much of our current national debt is because of hidden taxes.  I’m sure it’s not very much.  But there has to be some part of it that is, simply because hidden taxes contribute, even in a small way, to whatever amount government spends that is more than it takes in.

Thank you for taking time to read and ponder my opinion on this topic.
An Opinion Article by Dave Kemper
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It has been said that: "One definition of insanity is to do the same thing, the same way, over and over and over again, each time expecting to achieve a different result."
Therefore, we must either CHANGE the way we live, or we bind our future to our past as if with CHAINS.
"I do not consider myself to be better than anyone else.  But I do believe in exercising my right to not stay stupid."

David W. Kemper, Author
© Copyright 2014 by David William Kemper.  All right reserved
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