Scott Svonkin: California’s ballooning black market must be halted
By Signal Contributor
Tuesday, October 24th, 2017

In the wake of Donald Trump’s ongoing attacks on America’s undocumented community, the underground economy within California is growing exponentially, resulting in the further exploitation of California’s work force and billions in lost revenue for our state.

According to the U.S. Department of Labor, Donald Trump’s xenophobic rhetoric and policies have caused undocumented field workers to completely fear all government employees, regardless of their purpose, in anticipation of Trump’s workplace ICE raids.

Instead of speaking to Labor Department officials about workplace abuses or getting back wages owed to them, many undocumented laborers simply run away or avoid work completely.

Housekeepers, hotel workers, landscapers and other undocumented and low-income workers are being abused by employers unwilling to pay taxes for legitimate salaries, pushing their workers further underground and magnifying the state’s labor black market.

Based on data from the IRS and California Franchise Tax Board, California loses approximately $10 billion every year because of business evading taxes.

This exorbitant amount of lost revenue for the state is incredibly detrimental to the working and middle class families that largely rely on state services, from vital infrastructure to our education and health care systems.

Forcing more economic activity underground will hurt our state’s families and children because every tax dollar not collected is one dollar we cannot spend on education or public safety.

Businesses that participate in this black market tend to do so in an effort to avoid paying properly trained individuals their fair share of income. Whether it’s construction companies or food services, not having properly trained or paid workers can lead to unsafe buildings or befouled meals that endanger the public.

Ensuring California’s businesses pay their share of taxes and eliminating the underground economy allows our communities to feel safe knowing employees are properly trained and legitimate in dealing with their everyday transactions.

Proper training also grants employees assurance of workplace safety and protects them from exploitation by their employees, giving them security and allowing them the possibility to find other employment opportunities using their skills and experience.

We need to take on tax evaders to regain this loss in revenue that has deeply crippled California’s ability to adequately provide funding for our schools or engage in ambitious projects like single-payer health care or eliminating tuition at public colleges and universities.

As a current member of the Los Angeles Community College District Board of Trustees, as well as a product of California public schooling institutions, I fully understand the importance of affordable higher education. Our system continues to be woefully underfunded.

If state officials can collect just a fraction of these taxes, California can fund free community college for all residents, which will incentivize more young people to pursue a higher education and be a tremendous boost to our state’s long-term economic growth.

The continued growth and success of California depends on the reclamation of taxes from underground businesses. California’s elected Board of Equalization members need to focus now as never before on cracking down on the black market festering out of our sight because tax evasion and worker exploitation is incredibly damaging for the millions of hard-working Californians who deserve the full benefits of their valuable tax dollars.

Scott Svonkin is a member of the Los Angeles Community College board and a candidate for the California Board of Equalization District 3.

About the author

Signal Contributor

Signal Contributor

Scott Svonkin: California’s ballooning black market must be halted

In the wake of Donald Trump’s ongoing attacks on America’s undocumented community, the underground economy within California is growing exponentially, resulting in the further exploitation of California’s work force and billions in lost revenue for our state.

According to the U.S. Department of Labor, Donald Trump’s xenophobic rhetoric and policies have caused undocumented field workers to completely fear all government employees, regardless of their purpose, in anticipation of Trump’s workplace ICE raids.

Instead of speaking to Labor Department officials about workplace abuses or getting back wages owed to them, many undocumented laborers simply run away or avoid work completely.

Housekeepers, hotel workers, landscapers and other undocumented and low-income workers are being abused by employers unwilling to pay taxes for legitimate salaries, pushing their workers further underground and magnifying the state’s labor black market.

Based on data from the IRS and California Franchise Tax Board, California loses approximately $10 billion every year because of business evading taxes.

This exorbitant amount of lost revenue for the state is incredibly detrimental to the working and middle class families that largely rely on state services, from vital infrastructure to our education and health care systems.

Forcing more economic activity underground will hurt our state’s families and children because every tax dollar not collected is one dollar we cannot spend on education or public safety.

Businesses that participate in this black market tend to do so in an effort to avoid paying properly trained individuals their fair share of income. Whether it’s construction companies or food services, not having properly trained or paid workers can lead to unsafe buildings or befouled meals that endanger the public.

Ensuring California’s businesses pay their share of taxes and eliminating the underground economy allows our communities to feel safe knowing employees are properly trained and legitimate in dealing with their everyday transactions.

Proper training also grants employees assurance of workplace safety and protects them from exploitation by their employees, giving them security and allowing them the possibility to find other employment opportunities using their skills and experience.

We need to take on tax evaders to regain this loss in revenue that has deeply crippled California’s ability to adequately provide funding for our schools or engage in ambitious projects like single-payer health care or eliminating tuition at public colleges and universities.

As a current member of the Los Angeles Community College District Board of Trustees, as well as a product of California public schooling institutions, I fully understand the importance of affordable higher education. Our system continues to be woefully underfunded.

If state officials can collect just a fraction of these taxes, California can fund free community college for all residents, which will incentivize more young people to pursue a higher education and be a tremendous boost to our state’s long-term economic growth.

The continued growth and success of California depends on the reclamation of taxes from underground businesses. California’s elected Board of Equalization members need to focus now as never before on cracking down on the black market festering out of our sight because tax evasion and worker exploitation is incredibly damaging for the millions of hard-working Californians who deserve the full benefits of their valuable tax dollars.

Scott Svonkin is a member of the Los Angeles Community College board and a candidate for the California Board of Equalization District 3.