Alyn and Deeside MP Mark Tami questions Chancellor on off-payroll tax changes

An MP is supporting constituents affected by changes to off-payroll working rules by asking questions in Parliament.

Mark Tami, MP for Alyn and Deeside has submitted written questions to the Chancellor of the Exchequer in a bid to ensure self-employed contractors aren’t left shouldering extra tax and National Insurance costs, without receiving any employment benefits in return. 

Plans to extend off-payroll (IR35) changes to the private sector as well as the public sector will see employers decide on whether a contractor should be employed or self-employed.

If they are the latter the worker will need to pay tax and National Insurance, including their client’s contributions, but they will not receive any employment benefits such as sick pay, holiday pay and pension contributions.

Mark Tami said: “Of course I believe it’s hugely important that we all pay our tax and National Insurance contributions.

“However when a company is effectively employing a contractor in all but name, letting them shoulder all of the costs without offering any employment benefits in return, this is unfair.

“It’s a simple question- are you employed or a self-employed contractor? It doesn’t make sense that you should be taxed as one but get the employment rights- or lack of them- of the other.”

Mr Tami’s first written question asks the Chancellor what assessment he has made of the potential short-term and long-term effect on seasonal workers in the offshore wind industry of the changes to IR35. 

The second asks what assessment he has made of the maximum appropriate rate of income tax and national insurance for workers when calculated together in each income tax band affected by the changes to IR35.

Mr Tami has also added his signature to an Early Day Motion that raises concerns about the plans.

The EDM notes that HMRC estimate that 153,000 UK contractors could lose up to a quarter of their pay and that thousands of workers will be forced to pay their employer’s tax bills, without getting the benefits of employment such as sick and holiday pay and a pension contribution.

The EDM also raises the possibility that the off-payroll tax will lead to tax non-compliance and the danger of people being lured into avoidance schemes. It calls for the extension of the scheme to be halted while a review into IR35, promised during the election, is carried out. The independent review should look into how best to recognise contracting and freelancing in the tax system.

Mr Tami added: “This issue will affect a lot of my constituents in Alyn and Deeside so I look forward to receiving the Chancellor’s responses on this important matter.”