Tuesday, November 17, 2009

The Wacky Media

The Associated Press ran a story about a loophole in the huge tax increases on tobacco that Congress passed last spring. Apparently, the tax on "roll your own" tobacco was increased from $1.10 to $24.78 a pound. The loophole is that pipe tobacco, similar in texture and consistency, was spared the monster increase, taxed at a mere $2.83 a pound. Tobacco companies, being both alert and wily, pulled the "roll your own" tobacco off the shelves, repackaged it as "pipe tobacco" and put it back on the shelves, where smokers could buy it without the onerous tax.

Here's where the AP threw me: "
Tobacco companies say they're just trying to find a legal way to stay afloat after being saddled with an enormous tax increase. But both the Obama administration and some in Congress say they'll try to come up with a distinction between the tobacco types, closing a loophole that could cost taxpayers hundreds of millions of dollars a year."

That last phrase is odd. The loophole is actually saving taxpayers (i.e., smokers) hundreds of millions of dollars a year. They don't have to pay an exorbitant price (tax) for tobacco. The only entity that it's "costing" money is the government and, by extension, politicians. What's "costing" taxpayers is those same politicians spending money like drunken sailors. Unfortunately, the AP doesn't approach subjects with that outlook.

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