Price-based excises are rare

Go to new version with more examples published October 2013 here.

Examples of excise taxes based on percentage of price are hard to find.  Only five come to mind quickly:

1. The Confederate Civil War taxes, listed below.  The Union taxed liquor by potency – cents per proof gallon.[1]  I don’t say that the Union’s choice of tax base explains the victory, but I do suggest that the Confederacy’s choice of tax base illustrates how primitive that “nation” was;

2. Rental car and hotel room taxes – imposed on services, not goods (some folks might not consider that an excise, but it’s a higher than normal rate);

3. The 2.3 percent tax on medical devices in the Affordable Care Act — a tax that is barely hanging on in the face of repeal efforts.  That tax acted to take back benefits the ACA gave that folks thought were too generous — like applying the brake because you know you are pushing too hard on the accelerator but don’t know how to calibrate that pushing.

4.  Taxes on prostitution, like the 19-percent excise tax in Holland:  http://www.huffingtonpost.com/2011/01/12/dutch-prostitutes-taxes_n_807843.html

5.  Today’s marijuana taxes in Washington, Colorado, and California localities.

Maybe that’s because percentage-based excise taxes on goods are not a great idea.  I’m studying that issue.

Here’s a list of items the Confederates tried to tax at 25 percent:

Alabaster and spar ornaments; anchovies, sardines and all other fish preserved in oil.

Brandy and other spirits distilled from grain or other materials, not otherwise provided for; billiard and bagatelle tables, and all other tables or boards on which games are played.

Composition tops for tables, or other articles of furniture; confectionary, comfits, sweetmeats, or fruits preserved in sugar, molasses, brandy or other liquors; cordials, absynthe, arrack, curacoa, kirschenwesser, liquers, maraschino, ratafia, and other spirituous beverages of a similar character.

Glass, cut.

Manufacturers of cedar-wood, granadilla, ebony, mahogany, rosewood and satin-wood.

Scagliola tops, for tables or other articles of furniture; segars, snuff, paper segars, and all other manufactures of tobacco.

Wines–Burgundy, champagne, clarets, madeira, port, sherry, and all other wines or imitations of wines.

http://docsouth.unc.edu/imls/19conf/19conf.html (search for brandy).