REC keeps VAT Staff Hire Concession firmly on the agenda

The REC met with key Treasury officials last week on the VAT Staff Hire Concession.

Kevin Green, Chief Executive of the REC said: We used this meeting to press home the concerns of members that the removal of the staff hire concession will reduce temping opportunities in the affected sectors. It is clear that the Treasury are considering the impact of the concession carefully and are keen to understand how agencies may be using alternative business models to mitigate the effect of the removal of the concession. It is possible that they may allow more time for these models to be put in place.

Green continued The REC has made numerous representations to the Treasury on this matter over the years. Our high profile media campaign has brought this issue to the attention of Ministers at the highest level. It simply does not make sense to be seeking ways to create jobs on the one hand and remove measures, such as the concession, which will add cost to the supply of temporary staff. REC has brought together a coalition of bodies representing the affected sectors to ensure that Ministers are aware of the effect of the removal of the concession. REC will continue to lead the fight to delay the removal of the concession at this critical economic time.

The REC has worked with the following bodies on the removal of the staff hire concession:

* Charity Finance Directors Group
* Charity Tax Group
* Procurement for Housing
* English Community Care Association
* Association of Colleges
* British Bankers Association
* London Investment Banking Association
* Confederation of British Industry

The REC will be following up on last weekís meeting by presenting further information to the Treasury on how much time agencies will need to implement alternative business models with clients. Green concluded With 1st April fast approaching we are seeking urgent clarity on how the Government intends to proceed on this matter.

ìWhilst we remain optimistic that the government will see sense on this issue, recruiters should put plans in place for the removal of the concession on 1st April.