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In order to get a level playing field for workers a strategic review is the UK’s only hope

Paystream News

Friday 12th Feb, 2016

According to PRISM Chief Executive Crawford Temple, if the Government is to meet its long-term aim of a simplified tax regime then a strategic review of the entire legislative framework relating to contractors is needed.

Crawford explains that an extensive review of the whole system would deliver a "win-win situation" for the Government and is the only way to deliver a level playing field that would stand the test of time.

According to Crawford there are six key reasons why a review is necessary and what it would result in, these reasons include:

  1. The right taxes for the right worker, recognising the different sectors within the market
  2. A level playing field removing unintended market distortions
  3. A simplified tax system that is more easily understood
  4. Increased tax compliance helping to manage the tax gap
  5. Increased compliance throughout the supply chain
  6. A clear roadmap for legislation based on government’s stated long-term objectives

At the moment Crawford believes that the Government takes a 'sticking plaster approach' that creates a domino rally of market distortions as firms attempt to give employers and workers what they want while trying to follow rules that were never meant for them. A review could see an end to that and deliver the above clarity.

Crawford goes onto explain that: "Our tax framework was created in an age when everyone was either employed or self-employed but times have changed. Today's flexible workers don't fit the traditional categories of employed and self-employed and there are too many of them to brush them under the carpet. More than 10 per cent of the working population are flexible workers. The intricacies of the labour market need to be more fully understood and legislated for as a whole."

Crawford added: "PRISM wants to be forward looking on this issue and help improve compliance, raise standards and create a framework to reflect the 21st Century. As such, we look forward to being able to contribute to a vital review that is long overdue."

There are currently more than 1.6million contractors in the UK and Crawford believes that a review would result in more jobs that people want and more investment. If there is no review than Crawford is concerned that this could become a threat to the UK plc's flexible workforce which has not only delivered real results for business but has also helped pull the UK economy out of recession.

Crawford explains that the overriding principle must be to give temporary workers the same certainty and clarity over their tax affairs that the likes of an employee, the self- employed or an entrepreneurial businessman does.

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