Gas is about $3.16 & 9/10, why is it 9/10 of a cent, and where does the 1/10 of a cent go? I mean when I buy 10 gallons of gas I don`t get a penny off the next gallon, so where do the fractions of cents go.
2006-07-24 09:51:34 · 4 answers · asked by Anonymous in Politics & Government ➔ Government
The penny is broken down into 100 mils. It is actually 90 mils you pay. So for every $10.00, you pay 9cents tax. When you buy the $10 dollars of gas, you don't get that much gas and then pay the additional tax. That would upset the uneducated masses. Actually you only get $9.91 worth of gas. 99% of the people don't know this. This way the people stay Fat, dumb(meaning stupid and mute, so Congress is correct, we are to stupid to speak out) and happy(thinking it is a cheap and affordable tax). By itself it would be affordable. But, the Federal Government gets an additional 17 1/10 cents per gallon in taxes for a total of 18 cents. Then the State adds 28 -66 cents (depends on each state. Idaho is 28 and NY is 66). Then the City and County adds 3-5 cents. Then the station owner gets 3-5 cents for each dollar you spend for gas. The oil company get 8 cents in profit. The rest is in the cost of buying, refining, transporting, employee pay and benifits and other operational expenses..
Back in the 20's when the tax was imposed 9/10 of a cent was a lot of money. As fuel sales soared it remained a large source of income for the government. It still remains so today. But, as Congress would do, they found new ways to impose additional taxes. This allowed them to keep it a that rate. They were afraid of the uproar if raised to an even penny.
Why the 9/10 to begin with? Congress back then was no different than today. They figured the people were too stupid to realize they were paying nearly a penny. Basicly they were correct. The penny is broken down to 100 mils. Tax increases used to be raised in mils.This Made it more difficult for the people to understand how much the actual tax increase was or is. A 3/100 or 3 mil tax doesn't sound like much. That is, until you start paying it on high value items like a house. A 3 mil property tax increase by the state or schood district add up to a lot of money on a $100,000 house. $3,000.00 as a matter of fact.
2006-07-24 11:53:22 · answer #1 · answered by Anonymous · 3⤊ 2⤋
I have no idea where the 1/10 of a cent goes, but I would imagine that it goes to the Gas companies. Right now, even though gas prices are at an all time high, it's not because of the wars in the middle east. The Gas companies are clearly making more money than they ever have and it makes you wonder, 'if the price of gas is so high, wouldn't the Gas companies have to pay more for that gas, therefore wouldn't they not make a bigger prophet?' They are obviously using the wars in the middle east as an excuse to hike up gas prices. Even if it did cost them more per barrel due to wars in the middle east, why would they raise the cost even higher than they need to? I know that this doesn't really answer your question, but that would be my take on the matter.
2006-07-24 17:06:50 · answer #2 · answered by ? 5 · 0⤊ 0⤋
it just so happens that the federal tax on gasoline and diesel fuel has a certain amount of tenths in it. several years ago the federal tax made the price of gas something like .56 and four tenths cents a gallon. it was the feds who changed the tax amount to put it to reflect 9/10 of a cent. the actual rate is set by the feds at differring amounts but the 9/10ths is always there now.
2006-07-24 17:09:58 · answer #3 · answered by de bossy one 6 · 0⤊ 0⤋
It's because 9/10, at a first glance, appears substantially less to the average human than 1 full cent.
2006-07-24 16:56:50 · answer #4 · answered by chhackett3 2 · 0⤊ 0⤋