The banking big means that 5% of companies profit from home tax
According to a new report from Deutsche Bank, a 5 percent tax should be levied on working from home.
The tax itself would be paid by the employer if the employer did not provide an employee with a permanent desk. If this is the case and the employee is working from home, the employee pays the tax from their salary for each day that they work from home. For someone on a £ 35,000 salary, that costs roughly £ 7 a day.
According to the Deutsche Bank report, the revenue from this tax would be paid to people who cannot do their work from home. The banking giant points out that since these employees work from home, they save money and take fewer risks when they are not going to work. So a tax would help restore the balance.
It is calculated that the UK tax would generate income of £ 6.9 billion a year. This in turn could pay out £ 2,000 in grants to low-income workers and those at risk of layoff.
The report is part of the Bank’s ‘concept’, an ongoing project designed to stimulate debate on key issues.
“For years we have needed a tax on remote workers,” said Deutsche Bank strategist Luke Templeman. “COVID just made it obvious.”
“Those who can WFH receive direct and indirect financial benefits, and they should be taxed to ease the transition process for those who have been suddenly evicted.”
The 5 percent tax rate “will not make you worse than if you had decided to go to the office”. The report goes on to say that the daily £ 7 total “is roughly what an office worker could spend on commuting, lunch and laundry”. However, this may not apply to those who bike or go to work and / or bring their own lunch. The deficit could also be in companies that are locally where these employees work instead of focusing on the inner city.
However, the report suggests that businesses may be better off with the savings from downsizing their offices.
The tax could also act as a deterrent to WFH, where employees may be more productive and potentially affect the company’s overall productivity and performance.
Not for self-employed or low-income people
Deutsche Bank would like to make it clear that this tax applies to workers who work from home, which suggests that their income is above average. This does not apply to self-employed or low-income people. This also does not apply to workers who are required to stay at home as part of a public health emergency or for other medical reasons.
Some are less than impressed with the proposal to work on the home tax.
Federation of Small Businesses (FSB) national chairman Mike Cherry told SmallBusiness.co.uk: “In the midst of such a sharp downturn, it is remarkable to see proponents of new corporate taxes. Between corporate tax rates, corporate and dividend taxation, VAT, capital gains tax, fuel tax, congestion and clean air charges, insurance premium taxes, and employer social security contributions, businesses already have enough to worry about.
“Many small businesses have gone out of their way to comply with government guidelines for working from home. You are investing in new operating methods at a time when revenues are falling sharply. The government should focus on helping small business owners get back to growth and not limit their chances by arbitrarily punishing homeworking.
“With unemployment rising and GDP falling again this quarter, every single policy decision from now on must be assessed for its ability to stimulate business creation, job creation and livelihoods. This is no time for new taxes or increases to old ones, quite the contrary. “
What do you think of the proposed Deutsche Bank tax? Join the conversations on our Facebook and Twitter feeds.
VAT on taxi costs, vehicles, fuel and staff travel – what can I claim?