The UBT, or unincorporated business tax, is a bane to many New York freelancers. (Briefly, it's a City tax aimed at LLCs and other partnerships, but it ends up hitting many successful sole proprietors, as well. You can learn more in our report on tax challenges.) This morning, the Sun ran a preview of the issue scheduled to be discussed at today's City Council hearing on the independent workforce. A quick summary:
- Mayor Bloomberg is proposing a reform that would reduce the UBT for freelancers
- Councilman Yassky wants to exempt those who earn less than $100,000 a year
- Freelancers Union wants to exempt independent workers entirely
Our position is clear and well-established: freelancers shouldn't have to pay a tax originally meant to capture revenue from big companies that didn't have corporation status. Last June, executive director Sara Horowitz wrote in a Daily News op-ed,
The UBT is double taxation, allowing the city to tax income first as personal income and again as business income. That's just plain unfair. . . . The tax is finally being seen for what it is: an unfair burden that makes it even tougher for many of New York's unique and most important economic contributors to make ends meet.
We're thrilled that City leaders are listening, and are taking action on this issue. More coverage of the hearing to come!