New employment laws could be on the verge of spiking your property taxes again. Find out the why, when and how…
California recently passed a sweeping new ban on remote workers and independent contractors. As with rent control, state income taxes, and other laws, New York may not be far behind in once again towing the line and unleashing a very similar ruling. It could have an incredible impact on your property taxes.
The New Freelancer Ban
Despite the fact that the new gig economy effectively said the national economy and tens of millions of people and their families in the wake of 2008, this great run may be over.
California’s AB 5 law went into effect on January 1st, 2020. The law effectively bans remote workers and independent contractors. This has the potential to impact at least 57 million Americans who work this way, as well as the businesses they used to work for. It’s stealing jobs from those in trucking, graphic design, tech, customer service, and many more.
As far back as 2018, CNBC reported 70% of people globally were working in this type of capacity, at least some of the time. Over in Brooklyn, around 60% of the workforce is believed to be remote workers. Far more may fall into these classifications on Long Island than you may realize. That has helped create a tremendous amount of work, and has been adding $1T a year to the economy according to UpWork. It has spawned many new technologies and efficiencies that have improved communications, the environment, healthcare and more.
The Impact Of The New Ban
The Balance reports that the national unemployment rate rose to an extreme of 10.4% in the wake of the Great Recession of 2008. Now imagine that tens of millions of people are laid off. It’s already been happening since last year. What if 60% of the population is laid off? We are talking about a crisis six times as bad as the Great Recession. One which some still haven’t recovered from.
Even if you don’t do this type of work, and don’t rely on these types of workers, you will feel the impact. That’s at least a trillion dollars each year that won’t be spent at other businesses. They’ll go bust too. It means millions who may not be able to afford their rent or mortgages in the next few months. Never mind their credit card bills, car payments, health insurance or any type of taxes.
This presents three huge issues that could skyrocket your annual property tax bill:
- Various levels of government will need billions more dollars to feed, house, and clothe these people, and police communities in the midst of the chaos
- The pool of business and individual taxpayers will shrink dramatically, along with how much they are paying
- Communities will be dealing with thousands of new zombie homes on which no one is paying the property taxes
There is no one and no business that won’t feel the side effects and fall out of this. Those who are the least affected are still likely to see substantial pressure to increase their taxes.