Tories to axe IR35 in £150m move.
The Tories have set aside £150m to cover the cost of repealing IR35 if the party wins the imminent election. They also say new anti-avoidance measures will be introduced in place of IR35.
After months of saying it would only review the tax measure affecting contractors when it comes to power, the Tories have decided they needed a stronger policy.
David Heathcoat-Amory, shadow trade and industry secretary, confessed the party’s policy on IR35 was ‘a bit weak’ and after consultation with industry bodies, and costing the new approach, decided it has to reverse IR35.
He said: ‘There are a huge number of people – around 100,000 – directly affected, and judging by the emails and letters we have been receiving they are very upset and would never vote Labour again.’
The £150m costing is said to be ‘cautious’, though many believe extra revenue would result from repealing IR35 because so many contractors would return to the UK. A High Court review of IR35 is due to start on 12 March.
For more on IR35 see opinion, page 20
AccountancyAge.com’s IR35 resource centre: www.accountancyage.com/Tax/1108595.