PRISM has been encouraged that the Chancellor did not, as many had predicted, make any further announcements on the extension of the off-payroll rules to the private sector in his Spring Statement. Whilst this doesn’t mean it will not happen it probably points to a delayed implementation date of 2020. This delayed date seems a more logical choice for any major change as it would come one year after Brexit. PRISM has always felt that making such a change at the time of Brexit would create too much uncertainty for businesses who are adapting to the post Brexit environment.
Crawford Temple CEO of PRISM commented: “We have been pressing for a delay in the consultation to the off-payroll in the private sector. We feel that this should be held over until the outcomes of the four recently announced consultations, following the Taylor Review, have been decided.”
He continued: “The government has a real opportunity to create a framework, both tax and employment, that are aligned, clear and will last the test of time. To achieve this will take some brave thinking and not just extending existing legislation that everyone, other than HMRC, feels has failed in correctly identifying a worker’s status. HMRC and the Treasury may feel it has worked as it will certainly raise more taxes, although I would question whether it is as much as reported.”
The government, in its response to Taylor, acknowledged that employment status for both tax and employment rights needs to be more aligned. PRISM goes further and believes that the current tax structure actually holds incentives to drive the behaviours of employers as they can make significant savings.
According to PRISM, any change will need to address these ‘incentives’ as part of the alignment to stand any chance of long term success. The organisation has made specific recommendations in its booklet @The Case For Structural Reform which can be downloaded from the website: https://www.prism.contractors/prism/images/The_World_of_Modern_Employment.pdf