My Tax Form Info

THE TOP 10 STUPID TAXES – III

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7. 1689: Tax incentives for gin production

Anyone familiar with Hogarth’s engraving, Gin Lane, will understand the implications of this tax blunder. William and Mary, the protestant monarchs who ruled between 1689 and 1702, discouraged the importation of brandy from the Catholic French and instead promoted the local production of gin by abolishing taxes and licensing fees.

Unfortunately, the affordability of gin made it a favourite drink of the poor, and soon lead to mass drunkenness, vice and poverty. Government attempts to reintroduce the tax only lead to a proliferation in the making of illegal – cheap and poor quality – gin. Finally, in 1751, the Tippling Act allowed for reasonable prices, taxes and regulation of production.

8. 1700s: Scottish whiskey tax

The Scottish government applied ever increasing rates of taxation on malt and whiskey in the early eighteenth century. Distillers were driven underground, making smuggling a standard practice for 150 years.

By 1777 only eight licensed distilleries were paying taxes, while 400 unregistered stills were thought to operate within Edinburgh alone. By the 1820′s around 14,000 illicit stills were being confiscated every year – suggesting more than half the whisky consumed in Scotland was “illegal”. Finally, in 1823 the Excise Act was passed, which sanctioned the distilling of whisky in return for a license fee of £10. Smuggling died out almost completely over the next 100 years.

9. 1990: Poll tax

This hated tax, set by local authorities, ended up being much more expensive than first thought – and eventually up to 30 per cent of people in some areas refused to pay. This culminated in the poll tax riots – 200,000 protestors attended Trafalgar Square on March 31 1990 – and ultimately to the downfall of Margaret Thatcher. It was replaced by council tax in 1993.

10. 1783: Hat tax

Prime Minister William Pitt added an excise duty to hats in 1783, costing retailers £2 a year in London and 5 shillings in the country. Duty was collected by means of a stamped ticket fixed to the lining of the hat.

A national debate ensued about what forms of headgear were classed as a “hat” – so in 1804 the statutory definitions were recast to include every description of hat by whatever name it was known, and almost every material from which it could be made. It wasn’t until 1811 that the tax was repealed.