U-NICA May 3, 2022 3:37:02 PM 8 min read

The Evolution of Tax Stamps

When the average consumer thinks about tax stamps or labels, they might ask why it is important to discuss them because “aren’t they just to monitor taxes paid to the government?”

The answer is yes, but no. In order to understand, the first step is to know what tax stamps are.

What are Tax Stamps?

The difference between a stamp and a label is how it is attached to something. However, in today’s society, tax stamps and tax labels are the same thing, but “stamp” is used as the more general term.

Tax stamps are markers placed on products, specifically stimulants, such as alcohol and tobacco. Before the vendor sells the goods to the final consumer, they have to pay the tax in advance and then receive the tax stamp as proof of payment. This is then placed on the product.

Tax stamps as a whole are used by the government’s tax collection office to make sure they receive what is owed to them from the sale of that good. It has no connection with the actual product and or brand and, therefore, nothing to do with the prevention of counterfeit activities for the products.

Tax Stamp History

Tax stamps were first created to have a physical means of collecting tax. The first recorded usage of tax stamps was in Spain in 1637, but they were too big to attach to the actual products. Eventually, it evolved into a variety of different types of tax stamps that could be affixed easily to any product.

First tax stamp

Types of Tax Stamps

One of the most common tax stamps that people tend to notice are those attached to alcohol and tobacco products. Consumers can see these tax stamps on the lids of alcohol bottles or on the opening of tobacco packaging. Usually it is another way to show proof that, not only has the tax been paid, but that the product has not been opened prior.

6954cbc8-fe1b-4ddf-8852-36bafb775e76However, a very common type of tax stamp that is used almost daily without awareness is the post stamp. The true name is post tax stamp. Post stamps are individuals paying a tax for the letter they are about to send. Often the average consumer doesn’t think of post stamps as a tax stamp due to them being so common and are even treated as collectibles.

Another type of tax stamps, specifically in the United States, are for firearms. Unlike alcohol products where the tax stamp is automatically on the product, firearm purchasers have to apply to pay for the tax stamp on top of applying to buy a firearm.

Each country has had its own way of making and designing tax stamps throughout the years. This is probably why post stamps are a highly desired collectible due to its variations in history. This evolution stems from the desire to protect tax stamps from counterfeiters.

Security Measures in Tax Stamps

Governments were able to incorporate different anti-counterfeit elements to tax stamps. These elements, combined together, make it extremely difficult for counterfeiters to reproduce.

These anti-counterfeit elements include:

  • Holograms
  • The Ability to Track and Trace
  • Type of Material they are printed on
  • Security threads
  • Watermarks
  • Coating
  • Different ways to print

These components also give the government and or company more control over their tax stamps such as knowing where it is at any point in the supply chain through tracing. They also allow each country’s tax stamp to be unique so any counterfeit goods that cross the border will have an even more difficult time due to tax stamps being printed on different types of paper or the use of different printing processes.

The tax stamp might have started as a tax collection measure, but it represents so much more.

U-NICA Protects Tax Stamps

U-NICA’s history has evolved just like tax stamps. The anti-counterfeit knowledge base started with the protection of banknotes, another government “product.” This then grew to protect different types of products and brands through a variety of anti-counterfeit technology, which can also be used in tax stamps.

Similar to any other consumer good, the use of U-NICA’s technology enables the government or company to link their product, in this case, tax stamps, with the digital world enabling a greater counterfeit monitoring solution.

Contact one of our experts to learn more today.

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