So the media is abuzz with the latest crisis: a 15-cent tax on Christmas trees to spend on advertising and promoting real Christmas trees. Oh the horror! But hold on a sec, where did this tax come from? Before we run wildly about accusing the government of nefarious designs, let’s do some digging. If you trace the history, you will find that the Christmas tree farmers themselves requested the tax!
Yes, as a guy in the Christmas tree biz (every Thanksgiving I don a lumbjack outfit and chainsaw, haul, bail, and sell trees on my grandparent’s Christmas tree farm in North Carolina), I am here to tell you that in 2008, the National Christmas Tree Association (an association representing the interests of 5000 growers in the US) petitioned the US Department of Agriculture (USDA) to impose a $0.15 tax on Christmas trees. (Those who are sharp should note this was during an entirely different administration, not that that has anything to do with anything).
But why would tree growers want this tax? Because sales for “lives trees” were declining due to the advertising efforts of artificial Christmas tree manufacturers, and the distributed nature of thousands of small tree growers meant they couldn’t effectively advertise their products. The same thing happened to milk, so what did they do? In 1983, the dairy farmers agreed to pay the USDA a small tax (via the Checkoff program) to advertise for them; hence, the “Got Milk” commercials were born. Ironically, this tax was…wait for it…yes, $0.15 per hundredweight of milk.
Seeing how this worked for milk and 17 other agriculture products, the Christmas tree farmers wanted a piece of the action. The new tax would be effective for 3 years, after which all growers who paid the tax could vote to either renew or dismantle it. After a several year study, during which comments were requested from individual tree growers and regional Christmas Tree Associations (such as the North Carolina one), 70% of growers and 90% of associations agreed with the idea. Thus, the USDA drafted a $0.15 tax to raise $2 million for advertising, which tree growers are hoping will increase demand and bolster a declining live Christmas tree market.
And now you know….the rest of the story (i.e., the one where bad journalists, sensationalist media outlets, opportunistic politicians, and ignorant Americans all muddle about yelling at each other). Now to be fair, I don’t think this tax would help Christmas tree farmers such as my family that much. We primarily focus on retail where we do our own advertising and networking. That seems to be working pretty well for us. I have heard family members worry about the economy and the reusability of artificial trees, though, so I don’t know for sure. From a consumer stand-point, the tax doesn’t seem to make a lot of sense. It is unlikely a monopoly is going to develop in the artificial tree business, so a decline in demand for real trees should just lowers prices for the consumer. The NCTA claims increased demand would offset the tax, meaning the effect on the consumer is negligible. Honestly, I’m not sure I believe that, but then again I’m no economist. However, the one thing I am sure of is that the government is not trying to kill Christmas or squeeze some more money into Uncle Sam’s pocket by grinching your holiday spirit. Also, if you want the thrill of choosing your own Christmas tree and having me chainsaw it down, haul it halfway up a mountain, bail it, and tie it to your car, come visit www.christmastrees4u.com. 🙂