I wish people would stop teaching their kids to believe in Santa, the Tooth Fairy, the Easter Bunny, etc. It's basically lying to your kids for your entertainment, and think how hurt and humiliated they'll be when they find out the truth. Some people say, "It's a good way to teach kids to be savvy and question authority", but there's better ways to do that then deliberately lying to and misleading them yourself. Plenty of other examples of lying authorities and misinformation. What do you think?
My parents never did that, so I don’t have the first-hand experience. (They taught me about God, but I don’t think they’re true believers themselves, so it always came off a bit “God’s nice and all but don’t, like, depend on on him for anything particular.”) But I do think it’s very weird that people teach kids these things as literally true. I don’t think most of them do it to teach questioning authority, either; I think they do it because they think it’s cute or traditional.
I’m the least qualified person to give parenting advice, but I think if you want to teach your kid that grown-ups are wrong sometimes, it’s better to admit it and apologize when you make honest mistakes or tell white lies, rather than intentionally make up ridiculous things.
On the other hand, I don’t think Santa Claus is horribly damaging for most kids. There’s a difference between a fictional story and a lie, and although a few parents get a little creepy-intense about “this is literally physically true and nobody’s allowed to tell you differently,” most are pretty firmly on the side of telling a story, and I think as they get older the kids understand that.