Here in our United States, our government is sliced and diced between Uncle Sam, 50 states, 3,141 counties, and 89,000-odd cities, towns, and villages. You would think that 244 years of independence, along with a dollop of Yankee ingenuity, would produce a crisp, streamlined system for paying for it all. Instead, we've got a janky assemblage of income taxes, property taxes, sales taxes, and tariffs, sutured together like Frankenstein's monster. Seriously, isn't it time for the villagers to start climbing the mountain with pitchforks and torches?
Naturally, some of the brightest minds in public policy are working to come up with new ways to feed the beast. Bernie Sanders proposed a wealth tax starting at 1% on amounts above $32 million and climbing to 8% at $10 billion. Will we feel sorry for poor Jeff Bezos when he's down to his last $98 billion? Bill Gates, seeing a future where robots have muscled aside human workers, suggests taxing the robots equal to what those human workers would have paid. What will he imagine when he sees us ditching environmentally destructive animal protein for Soylent Green?
It shouldn't surprise you, then, to learn that someone has figured out how to leverage one of 2020's biggest disruptions into more government revenue. Economists from Deutsche Bank have proposed a tax on . . . wait for it . . . working from home. And so, as the world gets ready for Lockdown Two: Corona Boogaloo, let's take a look at why they welcome a Schedule WFH coming soon to a Form 1040 near you!
Why should working from home be taxable? Deutsche Bank argues that remote workers enjoy direct and indirect financial benefits that their office-bound counterparts don't. Working from home eliminates boatloads of spending on travel, lunch, $5 lattes, and dry-cleaning. Assuming the average stay-at-home employee earns $55,000, a 5% tax would run about $10/day — roughly what they would have spent on commuting, food, and laundry. (You'd think economists would realize there's no lunch fairy filling home refrigerators for free, but that's a subject for a different day.)
As for who gets stuck paying the tax, Deutsche Bank recommends employers cover it when they don't give employees permanent desks. Those with desks would pay it for days they choose to work at home. Deutsche Bank estimates that U.S. workers will spend 4.6 billion days/year working from home post-Covid, suggesting the tax could raise $48 billion. They propose redistributing that money to low-income workers like grocery store baggers who don't have the luxury of smushing your bread and cracking your eggs from the comfort of their living room.
Look, our tax system is a mess. It's the financial equivalent of Cuba's car fleet, with mechanics keeping an island full of '57 Chevys operating with old lawnmower engines and broken toaster parts. Is the work from home tax genius? Or is it the sort of idea that sneaks up on you, then leaves you dazed in an alley without your watch or purse? The possibilities, we're sure you'll agree, are endless.
2020 is bringing us a different sort of Thanksgiving, with fewer friends and family. But if you've made it this far, you've got reason to celebrate. Have confidence in knowing that if Washington ever does hit us with a work-from-home tax, we'll be here to make the best of it. Have a safe and happy holiday!
Kathy- They will find a way to get back the money that they have spent over the past 9 months....The gov't giveth and the gov't taketh away! There is no free lunch!