CITB examines levy fears

The Construction Industry Training Board is examining whether the Inland Revenue's clamp-down on self-employed workers in the construction industry will lead to the imposition of a higher training levy rate on contractors.

A joint CITB and industry working party set up last September to tackle the issue will announce its decision in July this year.

The party is investigating whether the tax office's clamp down in April has led to more workers being taken onto the payroll. If so, the result could be a substantial reduction in the œ54 million a year levy total collected by the CITB, as the levy on self-employed sub-contractors is two per cent compared to one a quarter of one per cent for a directly employed worker.

A spokesman for the CITB said that it would want to make up any shortfall in income but added: "There might not necessarily be a shortfall in income though it looks that way at first glance.

"Some companies have said that they will use sub-contractors employed by agencies which means that the workers are still in effect self-employed.

"There are other factors to consider too. If more workers come onto the books, it might push companies above the œ61,000 annual worker payments threshold which means they'll be subject to the levy. That will off-set any reductions elsewhere."