Mike McKee was leasing a room when COVID-19 hit and forced him to work from home.
“When I open up my computer and they see a four poster bed frame behind me, it doesn’t look good,” he said. “It’s not conducive to a productive work environment.”
So, he said, he had to move into a new apartment where he could create a home office space. For him, working from home was not a privilege nor had it helped him save money. He said it was costing him more, especially because of substantial increases in his grocery and utility bills.
“Including the cost of the apartment, you’re talking thousands of dollars,” McKee said.
In November, Deutsche Bank - one of the world’s most influential banks - published a report exploring different ideas for how to rebuild from the pandemic. One of those ideas was a tax on those who choose to keep working from home when their office reopens and has space for them.
Under the proposal, someone making $50,000 a year would be taxed at 5%, paying $2,500. It would exclude those who are self-employed or on low income. The bank estimated the tax could generate $48 billion to help people less fortunate.
“I think it’s provocative, it’s interesting,” said Mark Hamrick, a senior economic analyst for Bankrate.com. “It’s also politically dead on arrival.”
Hamrick said there was no political will right now for a tax hike on income.
“The only thing that might be more unpopular than this idea would be a tax on widows and orphans,” he said.
Hamrick said it was true that more people were saving money during the pandemic. He added there was a need for revenue with governments predicting huge deficits, especially to provide for the millions struggling in this economy.
“We don’t have a great social safety net in our country and the lines at food banks that we’ve been seeing over these past many months is a testament to the downside of that,” he said.
Mike understands better than most. Charity is his job – he raises money for a non-profit. But, he said, a privilege tax was too much. Any money he saves is his own safety net, aware that in this economy no job is guaranteed.
“My partner and I have talked about what happens when one or both of us lose our job and, for a matter of months, maybe a year, are we going to be able to make it through?” he said.