What is ‘privilege tax’ in Deutsche Bank’s research note?
The entire global economy has been shattered beyond hopes because of the pandemic caused by COVID-19 With the news of the development of Coronavirus vaccines across the world by some of the leading medical companies in the USA, India, and Russia, the economy has slowly started to pace up. Hence, governments, associations, companies, and services like the Canadian Tax Consulting Service, tax consultants in palm springs, etc. are eyeing every opportunity to make up for the losses suffered. In the same attempt, Deutsche Bank, a leading investment banking and financial services provider headquartered in Frankfurt, Germany has come up with the concept of a “Privilege Tax”.
What is Privilege Tax?
Deutsche Bank which is believed to have invested heavily in commercial real estate has mentioned in its recently published research report with the name “What We Must Do to Rebuild”, that the people or the employees who will be working from home (WFH) post the eradication or the containment of the Coronavirus induced global pandemic should be taxed as much as 5% on their daily income. The idea is to make such employees pay for the privileges enjoyed by working from home. Some of the very obvious privileges of working from home are as enumerated below-
- Saving time, money, and human effort in traveling to and from offices.
- Lesser exposure to the risk of getting infected by any contagious diseases because of lesser social contacts and issues due to environmental pollution. Thus, savings in medical bills.
- Lesser expenditures on uniforms, dresses, food, and vehicle repair and maintenance costs.
- Liberty to keeping in touch with your family and friends.
- Besides, above there might many other related and unrelated benefits. However, some of these points might get nullified by the disadvantages posed by WFH culture. Recently, many employees have reported increased disruption in work-life balance, desk setting cost, obesity, mental and eyes related issues, etc.
What Deutsche Bank Has To Say?
Deutsche Bank has supported the proposal for Privilege Tax with some of the many valid arguments though, which have been discussed below-
- The money accrued from the taxes collected in the form of Privilege Tax can be utilized to fill the voids created in the logistics of the economic system across the world if all the countries agree to the proposal.
- The Privilege Tax money be used to fund the government launched schemes, incentives, or subsidies to help the under-privileged sustain their livelihoods.
- The companies should pay the taxes on behalf of their WFH employees and support those with very low salary bracket or non-permanent jobs.
- Self-employed people must not be taxed with the Privilege Tax.
This proposal has attracted rounds of controversies across the globe, leaving even the board of the bank in disharmony over this tax. Although, there are always two sides to a coin, however, it will be an extremely tough decision for the governments across the world to levy additional taxes on the so-called privileged employees.
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