by 
The Curious Bag
-
If you bought gasoline today, you paid a federal excise tax. You will find excises taxes on many products, services and activities you do each day. The United States government uses these taxes to pay for services it provides, like national defense.
Excise Uprising
One early excise tax caused a rebellion. Congress enacted a whiskey tax (7 to 18 cents per gallon) in 1791, eventually leading to the Whiskey Rebellion.
History
During the War of 1812, the Civil War, the Spanish-American War and World War II, the government increased its use of excise taxes. Following each war, many of the excise taxes were repealed.
Types
In 2009, you pay excise taxes mainly on gasoline, tobacco and alcohol. These taxes are referred to as sin taxes because they are levied on goods and services often seen as vices. You also pay this tax when you use your phone, get on an airplane, purchase a gun or play the lottery.
Function
The Internal Revenue Service (IRS) collects excise taxes because it is a levy on goods consumed within the country. Income taxes are the main source of revenue with excises taxes representing only about 10 percent of revenue collected.
Effects
Many state and local governments use excise taxes on products to raise revenue. The sin taxes are especially popular because they only affect the people who use the product.
Source:
Resource:
TaxFoundation.org
IRS.gov
Sin Tax
RELATED QUESTIONS
Copyright 2023, Wired Ivy, LLC