The Annals of Taxation

I’m lecturing at the University of Essex and going from office to office chatting with people about their research. This is hard physical labor — I repeatedly go down one or two flights of stairs in this rabbit warren, walk down a hall, up the stairs in the adjoining building, then back down another hall. What a waste — why?

The answer is that the British government imposes a value-add tax on building extensions, so that if the buildings are joined on each floor, the extension is heavily taxed. To avoid this, the University struck a deal with the taxman to allow one internal door between adjoining buildings, allowing what is merely an extension to be treated as a new edifice and to escape taxation. The only problem is that, as usual, taxes create a dead-weight loss, as my well-exercised, tired knees that feel like dead-weights now illustrate. I doubt the building’s planners considered the cost of this loss when they agreed to this tax-avoiding subterfuge. (HT: SP)

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  1. Chris Holmes says:

    From the perspective of your health and wellbeing, it is a fantastic bit of tax incentivisation as it builds additional physical activity into your everyday routines. This is precisely the area where we have lost a great deal of historical physical activity and represents one of the contributing factors to the obesity epidemic that will challenge the future viability of important social institutions such as the NHS.

    As always it is the perspective you are looking at something from that matters.

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  2. Mike B says:

    That is why I can’t stand value added taxes. They get you at every corner. Just take it off the top via an income tax or at a single point like a sales tax. It’s much less annoying.

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  3. Justin says:

    I’m not sure why, but it seems that the older, whiter, and wealthier you are, the more you complain about taxation.

    I know that it’s not a hard and fast rule, but I don’t think I know anyone who breaks it.

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    • pudge says:

      I know plenty of non-white, non-rich, people who complain about taxes. Most of them are small business owners (you don’t have to be wealthy to own a business, you know). Yes, most of them are older, which makes sense, since they are more experienced. And I am younger, and have been complaining about taxes since I was young and poor.

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  4. Eric M. Jones says:

    I don’t think such “Taxation-Inspired” architecture is rare. In Mexico (I was told), you start paying property taxes only when the house is finished. You might imagine that the houses keep get bigger, but no; you see a lot of concrete columns with decorative steel rebars sticking out of the top.

    A friend used to build tool sheds. One inspector demanded that–unless the shed was could be classified as “portable”– the owner would be taxed. My friend grabbed a set of wheels off a kid’s wagon and nailed then to the shed. Case closed.

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  5. Jordan Boyd-Graber says:

    As far as I know, such laws do not exist in the US. However, there are a number of buildings that try to emulate that style (many entrances to segments of a building with now internal connection), particularly in universities.

    For instance, the “Hovses” at Caltech or lecture halls at Princeton all share this property. They were both explicitly trying to emulate venerable British universities.

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  6. KevinM says:

    @Justin: Your take is a little uncharitable, maybe? I don’t read the post as a complaint about bearing one’s fair share of taxes. Rather, it’s a wry observation on distorted behaviors engendered by tax avoidance (and on decreasing stamina as one’s age advances).

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  7. Peter Andes says:

    Well, at least they got rid of the Window Tax

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  8. Sam Adams says:

    To Justin:

    Most people who complain about ‘taxation’ actually are not complaining about ‘taxation’ itself; what they are really expressing is frustration over the fact that they see so little value in return for the taxes they pay.

    Also your characterization seems a bit of a non-sequiter, perhaps a bit disingenuous? I think anyone who works hard learns the value of hard work and how it is exchanged for money. No one wants to see the fruits of their hard work squandered. I know I feel annoyed when I throw away groceries that spoiled because we did not use them on time. It is the waste that bothers me; I guess frugality and responsibility and stewardship are important values to me and I expect similar respect for those values from others as well. This tradition goes back to Benjamin Franklin at least.

    If I felt I were getting fair value in exchange for the taxes I pay, I would not mind so much. However, if you are going to assert that a significant amount of public money is not squandered on wasteul boondoggles, I’d have to ask you how well ethanol is working compared to what it was advertised to do, or why we need a Jack Murtha Memorial Airport in Pennsylvania that handles two or three planes a day, or why career politicians are scrambling to name new public buildings after themselves while essential infrastructure crumbles from neglect.

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