The Social Market Foundation, a think-tank with close links to Labour, is to recommend that the Government introduces tax breaks to companies which run home- working schemes.
The radical proposal will be included in a report, to be published late this summer, which is backed by US technology giant Sun Microsystems.
The think-tank, chaired by Labour peer Lord Lipsey, will argue that homeworking can increase companies' productivity and ease congestion on Britain's roads and trains.
The report is expected to say companies with home- working schemes should receive relief on corporation tax, but that the benefits should also be passed on to workers.
Sun Microsystems was one of the first companies in the UK to set up a homeworking programme, iWork, which has 2,300 registered users.
Leslie Stretch, Sun's managing director for the UK and Ireland, said: "I am concerned that people are spending two to three hours a day on unnecessary journeys. We are keen on promoting working from home ... We see an increase in productivity of around 15 to 25 per cent. "
He said that for social, political and economic reasons the Government should promote homeworkingthrough a small tax break.
Mr Stretch is due to meet Government e-Envoy Andrew Pinder in the next few weeks to discuss the idea.
Sun claims iWork has been a huge success. A survey found that 95 per cent of employees were satisfied with the programme. Sun chairman Scott McNealy has abandoned personal desks in the company's 79 locations worldwide. It has around one computer terminal for every three employees and each is accessed by a smart card. Sun claims this has saved it $53m (£32m) over four years.Reuse content