I’ve worked from home in various ways for over two decades, exclusively so from 1996 to 2007, a few days a week from 2016 to 2018, and then full-time again from 2018 and on. In all that time working from home I’ve been more productive, but I’ve also been a better citizen who isn’t clogging up the roads or polluting the air with my exhaust while sitting in traffic. But apparently, some economist thinks working from home makes me a bad citizen. Or at least one ripe for squeezing some more tax money out of.
A new research report from Deutsche Bank quotes some economists who say that the government should impose new taxes on people who work from home because we’re not sufficiently contributing to the economy. And because of COVID more people than ever are now working from home.
The proposed tax wouldn’t target citizens during times of government-imposed lockdowns, but a Deutsche Bank survey found that respondents would like to continue to work from home two to three days per week when it’s time for people to go back to the office. “That means remote workers are contributing less to the infrastructure of the economy whilst still receiving its benefits,” Templeman writes.
Leeches on the Economy?
In other words, because we’re not buying gas or a mass transit ticket or going out to lunch or paying for daycare or any of the other things that people who work from home don’t typically need, we’re leeches on the economy. This is, of course, asinine. For one thing, it’s not like people who work from home just sit on that money like Scrooge McDuck in his vault. We’re just spending it differently. Maybe I’m saving up that money to spend it on vacation or groceries or books or computers or to pay the increasing load of taxes that we’re being burdened with. It’s not that we’re keeping money out of the economy. We’re just spending in different places in the economy. You’d think that, you know, economists would understand that.
Also, by not commuting we’re providing other benefits to the economy and society. For one thing, we’re using fewer fossil fuels and contributing less to pollution. We’re cutting down on the consumption of corporate fast food and the attendant environmental and economic impacts. We’re present to our families for more of the day, contributing to the well-being of our kids, giving us more time to volunteer in our communities. Not to mention, we’re providing economic opportunity in for businesses in our neighborhoods to provide services that were concentrated in cities and near office parks. I could go on and on about the ways that working from home is better for all of us.
The Lie of Wealth Transfer
Then you have to ask how a tax would fix this.
Templeman believes that a $10 tax per WFH day would be reasonable for a person in the U.S. making $55,000 a year. He calculates that this would roughly raise about $48 billion per year for a fund that would be used to issue $1,500 grants to fellow citizens who’ve fallen on hard times.
First, $10 per day isn’t chump change. That’s $200 per month, $2400 per year. That’s an additional 5% tax rate for the hypothetical WFHer on top of all the taxes already being paid out. Oh, but you would have spent that anyway on gas and going out to eat and buying coffee, right? Except, I still need to eat and drink coffee, not to mention my increased expenses for electricity and heating oil and water and sewer and all the other ways household expenses go up when you’re at home all day. So that $10 per day is an additional expense.
But let’s also dispense with the fiction that legislators would use this tax windfall to provide $1,500 grants to others who’ve fallen on hard times. For one thing, we already have a government-funded social net to the tune of $645 billion by the federal government alone, plus $722 billion for Medicare and $448 billion for Medicaid. Why do we need yet another one? Why not just let the system do what it does already?
Beyond that, though, if you hand lawmakers a new multi-billion-dollar revenue stream and they’ll use it for what they always use it for: pork barrel pet projects that help favored constituents and big pocket donors.
What’s a Liberal WFH to Think?
It’s funny to see the Gizmodo writer wrangle with this. Gizmodo’s editorial viewpoint is decidedly liberal progressive so you’d expect them to like the idea of higher taxes and wealth transfer, but this strikes close to home. The typical tech blogger is a WFHer and this means money out of their pocket, which means of course that she redirects the tax-extractor at big corporations.
Since it’s big companies like Amazon and Google and Zoom that are making all the money off people working from home (which is arguable), then take big taxes out of them. Still the same fundamental problems though.
In the end, rather than seeing the new work-from-home revolution as a problem to be solved, we should be welcoming it as a solution to the problems we had before. Economies and cultures and societies change. They are not static so rather than penalizing people for finding a better way, let’s encourage more innovation. Maybe those lunch spots in the city can pivot. Maybe there’s a way to change their business model for the new reality. I bet a lot of them already are without waiting for people to come back because government-imposed penalties forced them back.