Year of Publication



Martin School of Public Policy and Administration

Date Available


Degree Name

Master of Public Financial Management

Committee Chair

Iulia Shybalkina

Executive Summary

This research paper will discuss COVID-19’s impact on remote work and its effect on local income taxes for cities across the United States. The paper specifically will be looking into how the increase in remote workers has affected revenue and policy changes for local income taxes since the pandemic. Before the pandemic, most US citizens with jobs had to be on-site, but COVID-19 seems to have changed how businesses are operating for the foreseeable future. A lot of businesses across the country have shifted to having more of their employees working fully remote or partially remote (hybrid) schedules. This has caused issues for cities that rely on local income tax revenues because in most circumstances local income taxes are subjected to either the employee’s work location or their residence. For example, if the employer’s on-site office is in downtown Philadelphia, but the employee lives in a nearby city and commutes into the office most of the time, then they would be subject to paying Philadelphia’s local income tax. If the employee was required work a fully remote schedule, then they would no longer be subjected to paying Philadelphia’s local income tax. Considering majority of non-public facing employers began allowing their employees to work remotely during the pandemic, this in theory should have caused some revenue issues for bigger cities that have a lot of commuters who are nonresidents of these cities. This research paper will investigate the financial implications of the increase in remote work and see if any of these cities have implemented new policies to prevent revenue losses. The hypothesis is that if the number of employers who allow their employees to work remotely increases, then cities’ local income tax revenues will decrease due to the decrease in their tax base if they are taxed based on workplace location and residence.

Digital Object Identifier (DOI)



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