Due to the mandated COVID-19 restrictions, many employers have offered employees the option to work from home. Both employers and employees are seeing the benefits of reduced commuter costs, saved time, a more productive environment (for many) and less impact to the environment.
Jim Reid, a senior official at Deutsche Bank, postulates in a recent publication, that the government should impose a new ‘privilege tax’ on home workers to pay subsidies to those workers that are still commuting to work.
The proposal is a 5% tax on employers, and the argument is that since home workers are no longer contributing to the economy’s infrastructure that they should pay for that work at home privilege. Reid, argues that working from home is financially rewarding and creates a disparity in salaries for those workers that cannot work from home.
For many workers though, there is no choice but to work from home.
The proposed tax penalizes small business, particularly start-ups. When a company is just starting out, fledgling CEO’s often choose to work from home to reduce costs. This is the only way many businesses are able to make a profit until they can afford to move into a more permanent space. Imagine if Jeff Bezos, who started Amazon in his garage, had chosen not to start his company because an at-home privledge tax on his business made the business un-economical.
Working at home and independent contract work has increased during COVID-19. For many people this has been a lifeline as traditional jobs have changed or disappeared.
The Deutsche Bank proposed privilege tax, will put new and existing at home workers jobs at risk and drive up costs for employers who are just trying to keep their businesses open during a pandemic.
A tax on those who work from home is a punitive tax on employees and employers, reduces competition and will destroy jobs.
