And it is this very characteristic that commends indirect taxation to the state, so that when you examine the prices of things you live by, you are astounded by the disproportion between the cost of production and the charge for permission to buy. Somebody has put the number of taxes carried by a loaf of bread at over one hundred; obviously, some are not ascertainable, for it would be impossible to allocate to each loaf its share of taxes on the broom used in the bakery, on the axle-grease used on the delivery wagon. Whiskey is perhaps the most notorious example of the way products have been transmuted from satisfactions into tax-gatherers. The manufacturing cost of a gallon of whiskey, for which the consumer pays around twenty dollars, is less than a half-dollar; the spread is partly accounted for in the costs of distribution, but most of the money which passes over the counter goes to maintain city, county, state and national officials.
Reading this, it dawned on me that those that poo poo gas taxes during periods of high prices disregard input taxes (not to mention other supply restrictions such as closing off exploration and development areas). Gas tax analyses count only direct taxes. They do not count all of the indirect taxes at various levels – from extraction taxes and royalties, profit sharing, fuel taxes on transport, taxes on capital for refineries, taxes on operations of refineries, taxes on energy inputs for refining, and on and on.