Tax changes 'could cause supply chain issues'
24/07/2009 17:30:00
Supply chain issues could arise due to taxation changes in the construction industry.
The government is proposing that construction workers be deemed as employees and subject to pay as you earn (PAYE) taxation.
According to HM Revenue and Customs, some 400,000 site workers are classed as self-employed instead of employees, Construction News reports.
However, this should only apply to people who supply their own materials and a significant amount of plant and provide extra labour, the Treasury claims.
There are fears among industry commentators that this would create supply chain issues.
Jason Campbell, chair of the construction group for the Recruitment and Employment Confederation, commented: "Any change in status also comes at a cost to the supply chain and it is vital that this is properly understood."
He added that it is vital that supply chain issues are avoided by adequately meeting the cost of the change, which would see recruitment agencies supplying workers on a PAYE basis.
Construction firms have recently been investigated following the discovery of a secret blacklist of workers, which prevented them from getting jobs, the BBC reports.
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