Awake, citizen taxpayers of America, you’ve nothing to lose but your having to pay more taxes and more taxes for the new Robber Barons of the “sharing economy”.
The new tech giants have sold us a bill of goods. It is, in effect, a fabulous Ponzi scheme – out of the goodness of their hearts, they allow us to pay more for the privilege of allowing them to make unconscionable profits.
And, like any good scam artist they have us play their 3 card monte and taxpayers and citizens lose every single time.
Surely, that’s overblown, you say. Well, let’s look at Airbnb in Los Angeles. Airbnb is the star of the sharing economy. It is the archetype for all the others picking up its model, from Uber to Under. Airbnb does fabulously well. Well so, you ask? Well, think polluter. Oil and gas is great to use, but it carries the Exxon Valdez and the BP Deepwater Horizon in tow. In the same way we have to regulate and protect against that, so to with the “sharing economy.”
Here’s the simplest example from Los Angeles, an insignificant sleepy town; a once proud American city, now long struggling with deficits.
Lost taxes from Airbnb activity would have eliminated some 27% of the annual deficit of the City of Los Angeles ! So, Airbnb brings in its trail – starving the City of Los Angeles of taxes; and probably jobs. If only.
If only, Airbnb had been collecting and paying taxes to Los Angeles here’s what would have happened:
Los Angeles will run a deficit of $165 million dollars – $165,000,000. Airbnb had sales in L.A. of $312 million dollars – $312,000,000. The taxes on this would have been $43.7 million dollars – $$43,680.000. Over a quarter (1/4) of the L.A. deficit would have been wiped out ! To paraphrase Mickey the tailor: ‘a quarter with one blow’.
Good for Airbnb. Bad for the citizens of Los Angeles, taxpayers and non-taxpayers alike.
Ah, says Airbnb we shouldn’t collect / pay over the taxes – we’re just a non-involved software intermediary between the hospitality, the “host”, and the guest. Some non-involvement. Airbnb collects the money; charges both the hospitality a commission and the guest a fee; takes its money from both parties (it doesn’t trust the “host” to pay them for services); and determines when and if the money should be forwarded to the hospitality. Really, really “non-involvement.”
And jobs. Airbnb likes to tout that it is providing added income to poor working class Angelenos supplementing their measly incomes with additional income – supplementing it by some 7%.
Well, that $312,000,000 is $312,000,000 in lost income to motels and hotels – and lost jobs in the industry, for sure. It’s equally in the calculation of whether to build new motels/hotels in L.A. or whether to upgrade existing ones and so new construction and new jobs are being lost now and on into the future.
And all of us Angelenos pay the additional price of cut-backs in city services to the level of intolerable “you call this living?”, because of the lost monies to Airbnb.
“Sharing economy” the way Airbnb and the over / unders have set it up is the magician’s art of deflection: ‘look at the pretty ball’, while the other hand palms $43.7 million!
(City of L.A. administrative officer Santana estimate of deficit; Airbnb promo of sales in L.A.)
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