Tokens and Taxes

We attended a (late) New Years gathering yesterday afternoon and the subject of World War II came up. Someone was asking people’s age and what, if anything, they remembered about WWII. I don’t remember much, but I do remember rationing and I remember where I was when the end of the war announcement came over the radio.
One thing I seem to remember than no one else present did was the use of mills — I’m not sure this was a World War II thing, but I associate it with the war and don’t remember them being used much after the war ended.
I probably remember them because they were made like a coin, but not nearly as thick and they had a hole in the middle. They were great for threading the string you used to spin your top with — the mill kept the string from slipping through your fingers. Of course you could just tie a loop in the end of the string and slip it over your finger, but this technique was better suited to yo-yo’s than tops — for a top, the mill was much cooler.

I think the reason I remember mills and others don’t has to do with where I grew up. Mills were really tax tokens and only some states issued them — Oklahoma being one of the states. The idea of tokens came as a result of the sales tax. When the sales tax practice began, it resulted in the final price of items often being fractions of a cent. Let’s say you purchased an item for $1.25 and the sales tax was 3% — the cost of the item would be $1.2875 ($1.28 and 3/4 cents.) The thinking back in the 1930s and 40s was that if the total was rounded up to $1.29, it would result in an “unfair” profit of 1/4 cent to the seller, but if it was rounded down to $1.28, it would be unfair to the seller by reducing the profit by 3/4 cent.
So — the solution was to provide tokens in fractions of a cent (“mills”) 1 mill = 1/1000 of a dollar or 1/10 of a cent. Using the $1.25, 3% tax example, the customer would pay $1.29 and receive 2.5 mills in tax tokens as change. If the next purchase came to, say, $5.4325, the customer could pay $5.43 plus the 2.5 mills in tax tokens. If this didn’t make life complicated enough, different states issued different tax tokens. Finally, people decided just not to worry about fractions of a cent.
As a note, my extensive research revealed that the last tax tokens were not discontinued until 1961. I wasn’t able to determine which state was the last to discontinue them…..

The “coin-like” tokens were made of aluminum, copper, zinc, brass, plastic (in several colors) cardboard and paper. (The ones I remember were aluminum.) The most common denominations were 1 and 5 mills, but other denominations were “coined” by some of the states.

One of the dictionary definitions of token is, “round piece of metal or plastic that is used instead of money in some machines — an object that looks like a coin and is used in place of a coin.” Today, we often use the term token to describe a minority included in a group to prove they’re culturally diverse. There’s a guy on South Park named Token because he’s the “token black guy.”

But again, I’m getting off track. Back to mills — it seems like taxes have always complicated things. But I kind of wish tokens would come back — you can’t use a form 1040 on the end of your top string.
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