Does the Government Hate Freelancers?

As tax time comes in the US, Eazl has a question: does the government hate freelancers? Should we rework the tax code to make sense for self-employed people? Have your say! Answer the poll at the end of this video or leave your comment.

• The New 40%: Freelancers and self-employed people represent the fastest-growing portion of the labor market in the US and in many countries around the world. There are currently 55mm freelancers in the US and by 2020 freelancers will be 40% of the work force [1]. This trend will only continue as millennials and Gen Z are the largest groups who opt in to the freelancer work style.

• Support for Big Business: Meanwhile, governments around the world continue to flow money towards massive corporations. For example, the CATO Institute found that $10bn in farm subsidies went to publicly-listed industrial agriculture businesses, $4.4bn in special financing was directed towards Boeing, and Walmart has received more than $150mm in land grants and financing at the expense of US taxpayers. [2]

• 43.3% Tax Rate: Now that it’s tax time, freelancers are cutting relatively huge checks to federal and state governments… and taxes on self-employed people are rising. In her Piece for the Huffington Post, Nancy Humphries shows that freelancers who make under $110k annually pay an effective tax rate of 43.3% in the US [3]. That’s a higher rate than most billionaires! The US isn’t alone in raising taxes on self-employed people. The UK just passed a hugely controversial law requiring self-employed people to pay higher National Insurance Contributions [4] which many self-employed people say makes it even harder to survive.

Sources:
[1] See https://www.slideshare.net/upwork/freelancing-in-america-2016/1
[2] See https://object.cato.org/sites/cato.org/files/pubs/pdf/pa592.pdf
[3] See http://www.huffingtonpost.com/nancy-k-humphreys/selfemployed-pay-highest-_b_2397853.html
[4] See https://www.theguardian.com/uk-news/2017/mar/09/self-employed-nics-increase-budget

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Davis Jones

Davis Jones

Head of Product at Eazl
Davis Jones is a communicator, academic, and content maker with 9 years of experience in content marketing, recruitment, product management and everything else that it takes to launch businesses. Located in Chicago and San Francisco.
Davis Jones

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