asked the Chancellor of the Exchequer whether he has yet come to any conclusion following responses made to the Government's consultative paper "The Taxation of Agency Workers Operating through Companies".
Yes. There have been a substantial number of responses to the paper. These have recognised that a problem exists in this area, but have expressed a wide range of differing views about what would be the appropriate action in relation to it. Having given these careful consideration, we have decided for the time being not to introduce further legislation on this topic—though this in no way precludes the possibility of our doing so at a future date, if some statutory provision appears necessary and appropriate. Instead, we propose for the present that the Inland Revenue should make use of their existing powers under section 16 of the Taxes Management Act 1979, to require regular returns from agencies of payments made to and information about agency worker companies. The information in these returns will be used in a systematic way to monitor tax compliance by these companies and where necessary to improve it.