Trade bodies and industry experts have both condemned the UK Government’s plans to stamp down on “off-payroll” workers in the private sector.
The Government’s consultation document was criticised for being too skewed towards its preferred outcome, which is to extend the public sector IR35 changes to the private sector.
Freelancer body IPSE said that the move was “shameful,” “anti-business” and a “fatal blow” to the UK’s flexible economy.
Chris Bryce, CEO of IPSE said: “For the Government to even consider introducing the ill-judged changes to IR35 in the public sector to the private sector before their full impact can be truly analysed is outrageous. It would be a fatal blow to the UK’s flexible economy. IPSE’s research – which suggests large numbers of contractors are walking away from the public sector, with a particularly bad effect on the NHS – paints a very different picture from the Government’s report.”
Mr Bryce went on to give an example of an IT contractor who had won a case against HMRC in court, successfully arguing that he was not inside IR35. This proves that even HMRC cannot accurately determine who is and is not inside IR35, according to Mr Bryce.
Industry tax specialists Qdos Contractor said that they believed that the Government should try to make the IR35 reforms work in the public sector before considering extending them to the private sector. Trade association FCSA said that HMRC has a “dismal” record with IR35 changes in the public sector and wondered how the Government could consider extending the reforms into the private sector.