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True cost of Osborne's stealth tax raid laid bare

Contractors in the construction sector will lose an average of &pound117 per week, equivalent to massive &pound6,084 a year, once changes to travel allowances take effect in April.

Teachers and nurses are also going to be hit hard.

Nurses will receive an overnight real terms pay cut of &pound89.43 per week or &pound4,650 a year, records show. Contracting supply teachers will lose &pound62.56 per week or &pound3,252 a year, according to the study. 

Trade body PRISM, which commissioned the research among its members, is campaigning to stop the Chancellor destroying the right of flexible workers employed as contractors to claim travel and subsistence relief to temporary workplaces. 

The Yes2T&S campaign, launched a fortnight ago, is designed to appeal directly to the MPs of affected contractors and protect workers from the changes. There are 1.6m contractors  in the UK who have no job security and lack the same access to sick pay, holiday pay and pensions enjoyed by normal employees.

Crawford Temple, CEO of PRISM, said, “These figures lay bare the huge impact this stealth tax raid by the Chancellor will have, affecting up to 1.6m contractors just as the country gets back on its feet.

“The overnight drop in take home pay will either mean there are fewer workers willing to travel or rates of pay will have to go up. That burden will be borne by public and private sector employers which will force prices up and deliver worse value for money for the taxpayer.”

PRISM estimates the changes to T&S will hit contractors with a 20 per cent pay cut on average and expects the cost of the shortfall in take-home pay to cost employers &pound7bn if they are forced to plug the gap 

The Yes2T&S campaign allows contractors and their supporters in the intermediary, tax, recruitment and umbrella sectors to appeal directly to their MPs for help in combatting the tax change.

Join up here:

PRISM is a not-for-profit membership organisation whose members service the needs of contractors. 

Find the Yes2T&S campaign at


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