Seven Stupid Laws That Drive Businesses Crazy

Who writes these stupid laws?

Hundreds of ridiculous laws on the books of every state in the country routinely make life harder for businesses and their customers while serving no obvious purpose.

This week we told you that Tesla Motors Inc. (Nasdaq: TSLA) will no longer be able to sell its cars in New Jersey because the automaker's direct sales model runs afoul of a law requiring that vehicles be sold through dealerships.

Tesla fought the law, and the law won. The New Jersey Motor Vehicle Commission voted 6-0 to adopt the rule, which goes into effect April 1.

And stupid laws preventing direct sales of autos aren't unique to New Jersey - Tesla can't sell its cars in Texas or Arizona, either. Ohio, Minnesota, and Georgia could be next. You'd think states would be happy to get the sales tax revenue from cars that go for about $71,000.

But no.

These states think it's better to protect the dealerships because their role as the middleman, according to an Associated Press story, "keeps carmakers from fleecing consumers and protects price competition."

What? Obviously these lawmakers have never set foot in an auto dealership.

But what's really exasperating is that stupid laws like this are rampant in America today.

Here are six more stupid laws that give businesses (and everybody else) fits.

Stupid Laws That Drive Businesses Crazy

1. Blue Laws: Many states passed so-called "blue laws," mostly from the 1600s through the 1800s, to prohibit various activities on Sundays. Some simply forbade the consumption of alcohol, but many made it illegal for businesses to operate. Amazingly, some of these laws have survived into the 21st century. Car sales are still against the law on Sundays in Colorado, Illinois, Minnesota, Missouri, New Jersey, Pennsylvania, Wisconsin, and Michigan counties with a population of 130,000 or more. Why auto dealers remain singled out is unclear. But perhaps the strictest remaining blue laws are those of Bergen County in New Jersey. Sunday sales of electronics, clothing, and furniture are all forbidden there.

   And we're just getting started...

2. By Any Other Name: In Texas, it's against the law to call yourself an "interior designer" or use the term "interior design" unless you have jumped through several government hoops, including paying a $400 registration fee.

3. Buried in Paperwork: The IRS created 1099 forms in an attempt to capture unpaid business taxes, though it appears to have done little but add to the burden of small businesses. The National Federation of Independent Businesses says compliance costs a business $74 an hour, or about $1,500 per employee. And it could have been worse - Obamacare originally had proposed that the 1099 program be expanded to cover virtually all business purchases, which would have increased the number of forms filed from dozens a year to hundreds or even thousands.

4. The Cost of Going Out of Business: A business in the city of Milwaukee that finds itself at the end of its rope will get a bit of salt rubbed in the wound before it can close its doors for good. The city requires a license, a mountain of paperwork, and a hefty fee (which varies according to the length of the sale and the value of the inventory) to hold a going-out-of-business sale.

5. You Need a Permit for That: Gone are the days when young entrepreneurs can set up their own little business on the front lawn of the family home and learn the ways of capitalism first-hand. Local authorities have stopped children from selling everything from Girl Scout Cookies to lemonade, citing violations of an assortment of rules and regulations. In one case in January, officials in Madison County, Mich., stopped an 11-year-old girl's two-year-old cupcake business, saying she needed a "commercial kitchen" to comply with the law. (A bill is pending in the state legislature that would allow the public sale of home-baked goods.)

6. Just What We Need - More Guilt: The Food and Drug Administration is finalizing rules that will require the display of calorie information on 5 million vending machines in the United States. Compliance is expected to cost the vending machine industry $25.8 million the first year and $24 million per year after that. Apparently the detailed nutritional information printed on the packaging of each of the snacks in the machine is not good enough.

Are you sick of excessive government rules and regulations? Have any stupid laws cost you money? Tell us about it on Twitter @moneymorning or Facebook.

No one can escape the high costs of stupid laws and over-regulation. One study put the annual cost of government regulation at a whopping $15,000 per family. Here are just a few of the ways that government is taking money out of your pocket...