Trick-or-treating just got a bit more expensive thanks to the hobgoblins at the Iowa Department of Revenue. The tax-hungry bureaucrats have decided to tax pumpkins because they are used for decoration instead of food. Yahoo.com reports:
The Iowa Department of Revenue is taxing jack-o'-lanterns this Halloween. The new department policy was implemented after officials decided that pumpkins are used primarily for Halloween decorations, not food, and should be taxed, said Renee Mulvey, the department's spokeswoman. ...Previously, pumpkins had been considered an edible squash and exempted from the tax. The department ruled this year that pumpkins are taxable — with some exceptions — if they are advertised for use as jack-'o-lanterns or decorations.
But in the glorious tradition of bureaucracies everywhere, there is a form to fill out - at least for taxpayers who eat pumpkins:
Iowans planning to eat pumpkins can still get a tax exemption if they fill out a form.
This sounds like added bureaucracy, but Iowa taxpayers should be happy. By this time next year, the bureaucrats will decide that some people are falsely claiming that they are eating pumpkins in order to dodge the tax. So the new form will require families to send in photos of pumpkin pie. The following year, some bureaucrat will decide that some of the pies were actually bought in stores, so tax exemptions will only be allowed if a bureaucrat is invited over for dinner. I'm just kidding, of course. At least I think.
On a more serious note, special tax exemptions for pumpkins based on their use is symptomatic of why the tax code is a mess. It's a mess in Washington, and it's a mess in the states. The common thread in all cases is that politicians try to micro-manage the economy (and raise campaign cash) by imposing penalties and creating loopholes. The ultimate victims are the small business owners who now will have even more of their time consumed by bureaucratic nonsense:
Kautz, who has owned his farm for seven years, was particularly dismayed with the notion of requiring customers to fill out a form verifying that they planned to eat the pumpkins they were buying. "It's another crazy, crazy, stupid thing," he said. Kautz said he will estimate how many pumpkins were bought for non-food purposes, and then will send the tax on that amount to the revenue department. "It gets unfeasible for people to have small businesses," he said. ... Other Iowa pumpkin sellers also expressed confusion about the new policy. ... None said they are asking customers to fill out the tax-exemption certificate.