Taxation has a tendency to sink into the arbitrary.
Its fairly easy to tax, by simple percentage of price, items that are exchanged for money at discrete moments in time and between separate agents.
But taxing the value of something that is not money being given (gift tax), transported (tariff), or lived in (real estate tax) is often hard to figure. What is the value?
It gets murky.
And theres nothing murkier, today, than trying to tax fossils.
Nearly a month ago, the BBC broke the droll tale of a whale fossil, the Basilosaurus Isis. (Since the first outing, the storys appeared as human interest nearly everywhere.) Excavated in the Valley of Whales, in Egypt, it was sent to the University of Michigan to be assembled and studied. Then the U.S. paleontologists sent it back to Egypt, to be put in a new museum.
But there are a few problems. This new museum is said to commemorate, catalog and ballyhoo the aforementioned valley in northern Egypt that contains numerous fossils, particularly of prehistoric whales. Unfortunately, the museum hasnt been built yet. And the whales too big to fit in existing museums. Some say a fit home can be put up in two months.
So is that why the fossil is housed, currently, at Cairo Airports cargo village?
Maybe. But the story is longer than you might think.
Years and years ago, long before the first bureaucrat began figuring the best way to extract wealth from the first dusty digger of rocks, the Tethys Sea began to dry up. The geography and fossils left behind fascinate some folks more than does the Valley of the Kings. (In Egypt, it seems, every valley shall be exalted.)
Whats amazing about this particular fossil is that it is the mineral remains of a mammal that had moved from land to water not long before. It is one of those missing links that Darwin predicted wed find. Its found. Along with quite a lot of others.
And yes, this whale had feet.
So you might see why this particular species is valuable. And this particular example is extra valuable, since it is the only whole fossil of Basilosaurus Isiss remains.
Which begs the question: How much?
We are told there is no wide market in fossils. Too bad. (An open market would actually solve a lot of problems associated with the black market and, at the same time, aid science, since authentication processes would be required, and therefore give market value to paleontological expertise. But thats in the future . . . not our experience.) Sans markets, how do you establish value?
I mean, how do you, if you are an Egyptian customs agent?
I guess you say, Hey: Ten grand a leg! and demand $40,000.
That, in any case, seems to be the current situation. The reporter tells us that the whale fossil is being held up in Egyptian customs. A follow-up article informs us that three environmental NGOs have launched a campaign demanding the release of the reconstructed remains.
Its one thing to send a fossil up the Nile. Its another to send it through a bureaucratic bog.
There must be a lot more to the story. Do mummies returning to Egypt get taxed this way? Egyptian customs officials deny the story. The denial seems, however, a bit like a river in Egypt: The storys unlikely to dry up so easily, reflecting, as it does, a perennial truth about bureaucracy. Bureaucracies dont listen to common sense. They follow the rules. As bureaucrats understand them, and theyre not in the business of getting out of the way of science or ancient whales
But until the story settles out, and the truth appears in strata, Ill settle for a more down-home take-away: Arbitrary taxation is bad. Taxes that require fixing a value outside of actual market transactions are especially troublesome.
Thats why I dont like property taxes. The valuation of the house or land, in question — aside from an actual sale — sometimes becomes pure fiction.
Thats why I prefer a retail sales taxes to the horrible, European-style VATs.
Thats why I dont like tariffs, even if they are in the Constitution.
No sane person likes being taxed. But taxation that requires an arbitrary fixing of value — taxation that requires bureaucratic invasion and appraisal of private property — is far more intrusive by nature, and more likely to distort economic relations than, say, a simple transaction tax fixed as a percentage of money on one side of the transaction.
We should find ways to avoid the vague and arbitrary taxes. First and foremost.
The best way to do this is to decrease (and I mean really decrease) the size of government, so we arent tempted to tax everything in sight.
Including the remains of long-legged whales.