This reminds me of the Subaru BRAT in the early '80s. There was a 25% tarrif on imported pickups. So Subaru added two plastic jump seats in the back of the BRAT, even making them face backwards. No seat belts as I recall just handles. They weren't even really intended to be used. They were just cheap plastic. But they served the purpose of making the vehicle a four-seater car instead of a pickup, with only a 2.5% tarrif.
Here in Norway we have the infamous "E6 ham". We have an import tax on dry-cured ham[1], but not unprocessed meat.
Someone figured out it was cheaper then to import unprocessed meat from Spain to Norway, turn the truck around as soon as they were customs cleared and drive the 3000 km or so back to Spain for curing.
Once cured they'd re-import the processed meat, which now has a different tariff due to being "Norwegian" ham processed abroad, while still being proper Spanish dry-cured ham.
So a ~6000 km (3700 miles) detour to save on import taxes, yay...
The name comes from the E6 route[2] the trucks drive through Sweden and into Norway.
> Someone figured out it was cheaper then to import unprocessed meat from Spain to Norway, turn the truck around as soon as they were customs cleared and drive the 3000 km or so back to Spain for curing.
Ahh, those Norwegians and their customs evasions. https://youtu.be/oP1Oq3JLNbc (do note that I'm ascribing this to Norwegians completely in jest - tone is difficult to get across in text)
I never get why you actually have to put the ham on the truck.
In a slightly less illogical EU you could just go to the appropriate EU committe, and get an exception where you send the ham on a "virtual trip". Just proove that you payed the cost of shipment. The ham benefits, the environment benefits, everybody wins.
I would even go further and introduce a legal principle. Every law that can be circumvented by a ridiculous trick is either void, or the loophole has to be closed.
This reminds me of puzzles (as in physical 1000 piece things) in the 90s. It was cheaper to manufacture them somewhere, import them, export them to Spain, import them again than sell them straight from the country of origin which I think was Finland. All the while the stuff never moved and it was all on paper afaik. The lettering had to be in Spanish though but it's a puzzle, you know how it works.
If hams are fungible from a customs point of view (why would they not be?) you could try pre-curing the hams and have them ready just across the border. Ham in, ham out, ham in again, no extra trip to Spain required.
Then you sell the uncured hams you needed for the stamps to a pet-food factory or for German “salami” or whatever.
There's also the Ford vs Chicken Tax; basically U.S. import tariff for passenger van is 2.5% and cargo van is 25%, so Ford, which manufactured their Transit van in Turkey, installed seats in factory and stripped the seats once they arrived in the U.S.
Now looks like they are in trouble for this scheme.
There's also the infamous Toy Biz, Inc. v. United States case where Marvel Comics argued that their X-Men toys where "nonhuman toys" and not dolls to avoid an import tax.
Wow. I hope the government loses their lawsuit here. Customs & Border Protection should have absolutely no jurisdiction over what an item is used for once it enters the country.
Perhaps a more relevant and legally robust example is the Mercedes Benz Sprinter, which is manufactured in Germany, but US-bound vehicles have various parts removed before shipping. A facility in NC reassembles the vehicles (the removed parts are shipped with the van) once they arrive, which reduces or eliminates the tax.
I'm guessing they're only trouble because they took the seats out. Probably cheaper just to leave them in, and sell along with wrench to remove them 'in case it's needed for repair.' A friendly source will publish in a trade magazine it's the same van after 12 minutes to remove the seats, and the scheme will continue.
> Now looks like they are in trouble for this scheme.
All these cheats will never be accepted for working individuals. Corporations get a different flavor of justice. Even then they push it to the limits and dinner times find a burocrat in the pertinent agency willing to push forward a rightful punishment.
A seafood company in Canada has a 100 foot section of train track, where they load trucks on and right back off, in an attempt to get around the Jones Act requirement that goods shipped between 2 points in the US must use US flagged vessels
We need something like the senate filibuster debate rule for taxes. Basically just state that there is this thing I can do to skirt the tax system so I declare a tax evasion without having to actually make people do stupid stuff.
That's amazing. The section of track (ahem proper Canadian railroad) is quite visible on Google maps and street view has a great shot of it[0]. It is VERY short indeed.
Chrysler specifically designed the PT Cruiser to fit the NHTSA criteria for a light truck in order to bring the average fuel efficiency of the company’s light truck fleet into compliance with CAFE standards.
That's fascinating. I remember hearing there about a giant book on import taxes on apparel with various definitions. For instance, "sandals" may be taxed X but "open toed shoes" may be taxed Y. Apparently these rates drive fashion trends to an incredible degree where even small modifications to a product could totally change the economics.
There's a famous example that Converse All Stars included a very thin fuzzy lining along the outside of the soles so that they could qualify under the "slipper" tax instead of the higher "sneaker" tax.
Recently in Europe we had a kinda reverse - Suzuki removed the rear seats of the Jimny, a small 4x4, to reclassify it as a commercial vehicle to qualify for laxer CO2 emission standards.
Yeah, but they also really dumbed down the interior and lowered roof quality, while selling it for the same MSRP as the previous model (still + 10k from the actual sellers, bringing it to Toyota RAV4 territory price-wise).
That's a great article. Dives into philosophy without getting wishy-washy. Must have been a fun article to write.
> And if it's true to say, "a Jaffa Cake is a cake" (or "a Jaffa Cake is a biscuit") then that also tells us something about the world, i.e. about the properties of a Jaffa Cake, as well as about the meaning of the word "cake".
And of course it's even more fun because I have to mentally substitute "cookie" every time I read "biscuit".
It does shed a light on how arbitrary and ridiculous tariffs can be. I can't imagine the amount of resources wasted on enforcing, complying with and avoiding tariffs. There aren't many consensus in economics but getting rid of tariffs is one and here we are in 2022.
> The U.S. Customs Service changed vehicle classifications in 1989, automatically relegating two-door SUVs to light-truck status.[4] Toyota Motor Corp., Nissan Motor Co., Suzuki (through a joint venture with GM), and Honda Motor Co. eventually built assembly plants in the U.S. and Canada in response to the tariff.[1]...
> Customs and Border Protection (CBP) ruled in 2013 that Transit Connects imported by Ford as passenger wagons and later converted into cargo vans should be subject to the 25% duty rate applicable to vans and not to the 2.5% rate applicable to passenger vehicles. Ford sued and finally, in 2020, the Supreme Court declined to hear the case which confirmed the position of CBP.[22]
This kind of thing is apparently pretty common. The two that I know of are shoes -> slippers by adding fabric to the bottom and European manufactured vans being imported to the US as passenger vehicles and then converted to cargo after arrival.
I remember those! A family friend had one and he called them the "Oh Shit" handles! I had a blast riding back there for short trips. I think I was 12 or so. The 80s and early 90s were a very different time.
Oddly, the Subaru Baja is much more car-like than the Brat ever was (the Baja has 4 real seats, not jump seats), but when I had one, it was registered as a pickup, not a car.
The "truck" (trucks, SUVs etc) class of vehicles in the US have lower average gas mileage requirements than cars so many cars are made just large enough to be classified as "trucks" even though they are marketed still as cars. Subaru did this with almost all their cars back in 2004[1].
In Automotive manufacturing, CKD kits are a thing - Completely Knocked Down, or disassembled and shipped as parts and re-assembled again, to avoid taxes like this.
Preferred, but you often need more nuance than that — for example, if a carbon tax is set high enough to deter profitable heavy industrial activities it would require care not to have a disproportionate impact on people who depend on cars, non-electric heating, etc. Those can be mitigated, of course, but it starts to make the tax policy a lot more complicated.
The other problem is that we probably had time for a carbon tax when the idea was first advanced decades ago. It's not clear to me that we can afford a gradual approach now when we really need to be doing things like saying you just can't buy new coal burning equipment at any price, for example.
Carbon taxes seem to be pretty unpopular and I think it’s a failure of imagination for climate economists to keep repeating the same idea instead of trying to find things that are more palatable.
Selling stocks at a loss is only helpful in the short term, or if you don’t think those stocks are going back up. If you harvest a loss for a tax deduction on December 31, and the stock goes back up by the end of January so you’d be even, you are way behind – because the loss only comes back to you at your highest tax rate.
> and the stock goes back up by the end of January so you’d be even, you are way behind
there are ETFs created for the sole purpose of circumventing this, by providing exposure to the same asset or market forces
the wash sale regulation has amendment aimed at preventing this by prohibiting trades of "substantially similar securities", but I don't think it passes muster or has any teeth. you report all the trades to the IRS its up to them to figure out if your UltraShares 3x Inverse Pez Dispenser ETF is substantially similar to the Direxion one
Tis a very important note for as an amature tax-advantageous practice! You can buy something similar, though. eg trade AMD for Intel or some such. Where investors are concerned about markets rather than invidivuals stocks (AMD and INTC are both hardware tech stocks), the notion is that a rising tide lifts all boats, and that large, sector-related good news for Intel is good news for AMD. It's not strictly true, obviously, but it's close enough that the practice is worthwhile.
Canon will choose to make an insufficiently sized heatsink on its DSLR so that in video mode it has to shut down after 20 minutes so it can be classified as a camera and not a video recorder. https://www.cined.com/canon-eos-r5-heatsink-mod-improves-rec...
>Canon will choose to make an insufficiently sized heatsink on its DSLR so that in video mode it has to shut down after 20 minutes so it can be classified as a camera and not a video recorder.
The camera will record indefinitely in 4K line-skipping mode, so that's not actually the reason they didn't put the heatsink on.
That reason is either incompetence or market segmentation.
> That reason is either incompetence or market segmentation.
Yes
Or simply because most people don't record longer videos. Or because that heat has to go somewhere and a bigger heatsink might heat some areas (or the user).
Or the current heatsink is an existing part and it was "good enough"
> Fortunately, the fuzzy bottom doesn't affect the performance of the shoe.
That's false. They slide all over the place on tile and polished floors. They're terrible. I've abandoned them for Vans. Maybe they've improved in recent years but they lost me long time ago.
I can hardly think of anything more ridiculously overpriced than some canvas, rubber, and eyelets for $60. Then they have the gall to add extra crap that wrecks the shoe to pinch a few more pennies.
> Without the stiff competition of the smaller, lighter, easier-to-drive, and more fuel efficient import pickups and vans, Detroit automakers were no longer required to keep pace with innovation of foreign brands.
One has to wonder how much this innocent-looking levy contributed to the overall global warming situation, by never having the US automakers to be incentivized to manufacture more efficient commercial fleet, and, as such, inbreeding the culture of buying the overly big pick ups and SUVs with massive engines for private use, too.
I’ve heard that pickups got so big in the past decade or so because of Obama-era emission regulation. A bigger truck was classified differently and not subject to such strict guidelines, so when the old 3/4 and 1-ton trucks couldn’t possibly meet the new rules they got bigger to get around them.
To this day, super-duty pickups do not have to report fuel economy figures. I technically own a 1984 Ford F350, with a 460 cubic-inch (7.5 L) V8, that is rotting in a family member's yard in North Carolina, which (when operative) got 8-9 miles per gallon. It's about the size and length of a brand-new Honda Odyssey; the real split is between vehicles classed as commercial, and those that were not. Even today, you can buy an F250 with no EPA ratings due to the GWVR
NPR's Marketplace had a fascinating story about something similar in the apparel business. They design pockets in various types of clothing to reduce tariffs.
Certain women’s garments with “pockets below the waist” get lower duty rates than those without. Because of that, a number of the women’s shirts Columbia Sportswear makes are intentionally designed with tiny pockets near the waistline, which lowers the cost of importing them. One of the company’s shorthands for “pockets below the waist” is “nurse’s pocket.”
Something similar: for the original Playstation 2 that was sold in the EU, Sony included a DVD with a BASIC interpreter to classify the console as a personal computer. This little hack avoided some EU import taxes back in the day.
"In 2006, the European Union created a law that added an import duty of 5-12% to any video camera. What determined whether a camera was a video camera? In short, the ability to record longer than 30 minutes. Thus, companies like Canon and Nikon decided to cap their video clip lengths, preventing their enthusiast and prosumer cameras from being considered video cameras."
Readit News
Tarrif averted, thousands sold!
https://en.m.wikipedia.org/wiki/Subaru_BRAT
Someone figured out it was cheaper then to import unprocessed meat from Spain to Norway, turn the truck around as soon as they were customs cleared and drive the 3000 km or so back to Spain for curing.
Once cured they'd re-import the processed meat, which now has a different tariff due to being "Norwegian" ham processed abroad, while still being proper Spanish dry-cured ham.
So a ~6000 km (3700 miles) detour to save on import taxes, yay...
The name comes from the E6 route[2] the trucks drive through Sweden and into Norway.
[1]: https://en.wikipedia.org/wiki/Ham#Dry-cured
[2]: https://en.wikipedia.org/wiki/European_route_E6
Ahh, those Norwegians and their customs evasions. https://youtu.be/oP1Oq3JLNbc (do note that I'm ascribing this to Norwegians completely in jest - tone is difficult to get across in text)
... Which recently had an update. https://www.maritime-executive.com/article/asc-gets-green-li...
In a slightly less illogical EU you could just go to the appropriate EU committe, and get an exception where you send the ham on a "virtual trip". Just proove that you payed the cost of shipment. The ham benefits, the environment benefits, everybody wins.
I would even go further and introduce a legal principle. Every law that can be circumvented by a ridiculous trick is either void, or the loophole has to be closed.
Then you sell the uncured hams you needed for the stamps to a pet-food factory or for German “salami” or whatever.
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Now looks like they are in trouble for this scheme.
https://jalopnik.com/ford-faces-potential-1-3-billion-fine-f...
(And why it's called Chicken Tax is another fascinating story...)
https://en.wikipedia.org/wiki/Toy_Biz%2C_Inc._v._United_Stat...
The irony is that in the X-Men universe, the X-Men fight for a unification of mutants and humans.
[0] https://www.npr.org/sections/money/2017/01/25/511663527/epis...
All these cheats will never be accepted for working individuals. Corporations get a different flavor of justice. Even then they push it to the limits and dinner times find a burocrat in the pertinent agency willing to push forward a rightful punishment.
https://www.adn.com/business-economy/2021/09/15/feds-accuse-...
[0] https://www.google.com/maps/@45.1583297,-67.1396882,3a,75y,3...
Chrysler specifically designed the PT Cruiser to fit the NHTSA criteria for a light truck in order to bring the average fuel efficiency of the company’s light truck fleet into compliance with CAFE standards.
Anyway here’s a popular video of a 660cc Jimny towing a large truck that’s stuck in snow during the great Tokyo Blizzard of 2014.
https://m.youtube.com/watch?v=Ek5OebM4BC4
> And if it's true to say, "a Jaffa Cake is a cake" (or "a Jaffa Cake is a biscuit") then that also tells us something about the world, i.e. about the properties of a Jaffa Cake, as well as about the meaning of the word "cake".
And of course it's even more fun because I have to mentally substitute "cookie" every time I read "biscuit".
Isn't that tariff still in place?
It seems like they're smarter with the enforcement, so tricks like that don't work anymore:
https://en.wikipedia.org/wiki/Chicken_tax
> The U.S. Customs Service changed vehicle classifications in 1989, automatically relegating two-door SUVs to light-truck status.[4] Toyota Motor Corp., Nissan Motor Co., Suzuki (through a joint venture with GM), and Honda Motor Co. eventually built assembly plants in the U.S. and Canada in response to the tariff.[1]...
> Customs and Border Protection (CBP) ruled in 2013 that Transit Connects imported by Ford as passenger wagons and later converted into cargo vans should be subject to the 25% duty rate applicable to vans and not to the 2.5% rate applicable to passenger vehicles. Ford sued and finally, in 2020, the Supreme Court declined to hear the case which confirmed the position of CBP.[22]
[1]https://web.archive.org/web/20210609082852/https://www.nytim...
They would import from Europe with seats, but remove the seats at the port and ship them right back.
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For instance, dumping positions at loss before new years eve might help you with your tax bill since you have losses.
And of course, setting up a company in a country where you did buy a lot of spectrum and you have huge losses, effectively creating a tax credit ( https://www.reuters.com/article/telefonica-germany/update-2-... )
The other problem is that we probably had time for a carbon tax when the idea was first advanced decades ago. It's not clear to me that we can afford a gradual approach now when we really need to be doing things like saying you just can't buy new coal burning equipment at any price, for example.
there are ETFs created for the sole purpose of circumventing this, by providing exposure to the same asset or market forces
the wash sale regulation has amendment aimed at preventing this by prohibiting trades of "substantially similar securities", but I don't think it passes muster or has any teeth. you report all the trades to the IRS its up to them to figure out if your UltraShares 3x Inverse Pez Dispenser ETF is substantially similar to the Direxion one
For instance, I could sell my losses in a growth fund only to buy a different growth fund (not the same index though) and I get to stay in the market.
Ideally you would do this on day 364 of losses to maximize the tax incentive.
Columbia will add an extra pocket below the waistline on a women's shirt so it gets classified as a utility/work garment and they can price it 10% cheaper. https://www.marketplace.org/2019/05/29/theres-a-reason-your-...
Converse will line the rim/bottom of a shoe with felt so it can be classified as a slipper. https://www.smithsonianmag.com/smart-news/this-is-why-your-c...
Canon will choose to make an insufficiently sized heatsink on its DSLR so that in video mode it has to shut down after 20 minutes so it can be classified as a camera and not a video recorder. https://www.cined.com/canon-eos-r5-heatsink-mod-improves-rec...
The camera will record indefinitely in 4K line-skipping mode, so that's not actually the reason they didn't put the heatsink on.
That reason is either incompetence or market segmentation.
Yes
Or simply because most people don't record longer videos. Or because that heat has to go somewhere and a bigger heatsink might heat some areas (or the user).
Or the current heatsink is an existing part and it was "good enough"
That's false. They slide all over the place on tile and polished floors. They're terrible. I've abandoned them for Vans. Maybe they've improved in recent years but they lost me long time ago.
I can hardly think of anything more ridiculously overpriced than some canvas, rubber, and eyelets for $60. Then they have the gall to add extra crap that wrecks the shoe to pinch a few more pennies.
One has to wonder how much this innocent-looking levy contributed to the overall global warming situation, by never having the US automakers to be incentivized to manufacture more efficient commercial fleet, and, as such, inbreeding the culture of buying the overly big pick ups and SUVs with massive engines for private use, too.
https://www.marketplace.org/2019/05/29/theres-a-reason-your-...
Example from the article:
Certain women’s garments with “pockets below the waist” get lower duty rates than those without. Because of that, a number of the women’s shirts Columbia Sportswear makes are intentionally designed with tiny pockets near the waistline, which lowers the cost of importing them. One of the company’s shorthands for “pockets below the waist” is “nurse’s pocket.”
https://www.theregister.com/2000/11/07/sony_adds_basic_to_pl...
"In 2006, the European Union created a law that added an import duty of 5-12% to any video camera. What determined whether a camera was a video camera? In short, the ability to record longer than 30 minutes. Thus, companies like Canon and Nikon decided to cap their video clip lengths, preventing their enthusiast and prosumer cameras from being considered video cameras."