Pay more tax to work from home, says Deutsche Bank

Working from home comes with its challenges. Photo / Getty Images

People who choose to work from home should be taxed more up for the privilege, according to Deutsche Bank economists.

A team at the German lender has proposed a 5pc levy for those who choose to regularly work from home outside of lockdowns, arguing that such a measure could raise $48bn (NZ$68bn) a year in the US and €16bn (NZ$27 billion) in Germany.

"Working from home will be part of the 'new normal' well after the pandemic has passed," the strategists wrote in a new report. "We argue that remote workers should pay a tax for the privilege."

The team believe that the billions raised could "fund material income subsidies for low-income earners who are unable to work remotely", or go towards retraining staff who work at businesses that might not be needed after the pandemic, such as city centre sandwich shops.

"From a personal and economic point of view, it makes sense that these people should be given a helping hand," read the document that was first reported by Bloomberg.

"Those who are lucky enough to be in a position to 'disconnect' themselves from the face-to-face economy owe it to them."

The team found that once the pandemic passes more than half of those who have tried out working from home want to continue it permanently for between two and three days a week.

Those staff will save money on travel, lunch and socialising, the economists said, while also contributing less to the infrastructure of the economy.

"That is a big problem for the economy as it has taken decades and centuries to build up the wider business and economic infrastructure that supports face-to-face working," the report said.

The idea is that employers would pay the levy if they don't provide staff with a desk, whereas if the worker chooses to work from home they would be taxed for each day they did so.

In the US, the strategists argue that the tax could pay for a $1,500 grant to the 29m workers who earn under $30,000 a year and are unable to work from home.

- Telegraph