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Prop 22: Uber's Trumpian Tax Dodge

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California's Prop 22 is Trumpism in a Bottle.
California's Prop 22 is Trumpism in a Bottle.
(Image by Creative Commons photo from Wikipedia; modified by the author)
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Do you own a business in California? If you have any employees, you are paying Unemployment Insurance (UI), which helps pay for their unemployment benefits in case you have to let them go (such as, you know, when a pandemic closes down your business!)

Guess what? You are also paying for the unemployment benefits received by Uber and Lyft drivers--because Uber and Lyft don't contribute to the fund. That's right: they don't pay any UI--so when their drivers file for unemployment benefits (because, pandemic) other, responsible business owners--and the taxpayers--shoulder the cost.

How generous of you!

Now, this behavior on Uber and Lyft's part has been illegal since January 2020, but "legality" is just something that little people like you have to worry about--not Uber or Lyft. Prop 22 aims to change state law to make their tax-avoidance legal, by permanently granting them an exemption so they can classify their drivers as "independent contractors" instead of employees, and thus save on taxes.

They also get to weasel out of paying other taxes regular employers pay, such as payroll taxes that fund essential services like Social Security and Medicare. Thanks, everyone else, for picking up the tab!

And did you hear about that Prop 22 Postal Service scam?

Uber and Lyft's Prop 22 campaign is even screwing over the postal service--and all of you who do pay postage. If you are one of the many California voters being swamped by "Yes On 22" advertising mailers, guess what? Your tax dollars are helping pay for those!

Somehow, Uber and Lyft were able to get away with declaring their Yes On Prop 22 campaign to be a "nonprofit," earning them a savings of more than $1.5 million dollars to date on their massive, state-wide mailing blitz. True--Uber and Lyft have never seen a profit--but they are still very much for-profit. Those non-profit mailing rates are meant to benefit actual charities and, you know, non-profits... the exact opposite of cut-throat corporations like Uber and Lyft.

Uber and Lyft's tax-avoidance schemes must leave Donald J. Trump scratching his head admiringly and wondering, "Did I pay $750 more than I needed to?"

Next time: Prop 22 is bad for everyone's health

 

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Anthony Kalamar is an independent scholar and writer on environmental and technology issues.

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