Reform UK proposes tax on companies hiring foreign workers

Reform UK says it would tax companies hiring foreigners, in order to reduce the National Insurance (NI) paid by employers on their British staff, if it won the next general election.

The party argues the move would force firms to put "British workers first, migrant workers second" and take on unemployed Brits.

It plans a graduated levy targeted at lower-paid jobs, with full details to be released following a consultation with businesses.

Treasury spokesman Robert Jenrick said it would end "the cheap migrant labour racket once and for all".

He said that if elected, Reform would exempt British employees from last year's hike to the NI contributions paid by employers, whilst keeping the higher rate in place for foreign staff.

Speaking at a news conference in London, he said the party had estimated this tax cut would cost the Treasury £11.2bn, but he was "very confident" this could be paid for by the planned levy on foreign employees.

This would reduce in line with wages, he added, in order to reduce the "easy lever of cheap foreign labour" without penalising firms hiring "the most skilled people".

He suggested this would be set at £3,750 for companies employing foreign workers full-time at the minimum wage, an annual salary of £24,784 for those over 21.

This could be reduced to £1,500 for workers earning £50,000 a year, he indicated, then to £500 for those earning £100,000.

Jenrick declined, however, to specify the full proposed rates, saying it would be "irresponsible" to do so with up to three years before the next election.

Reform has already pledged to abolish the right of migrants to permanently settle in the UK after five years, forcing them either to apply for British citizenship or reapply for temporary work visas with higher salary requirements.

Jenrick acknowledged this meant the tax base for his proposed levy would "rapidly shrink", but argued the diminishing tax take would be compensated by savings in benefits paid to unemployed British nationals who would be offered jobs.

The policy is likely to have the greatest impact in sectors such as retail, hospitality and manufacturing, where companies are most likely to employ foreign workers.

It would also have a big impact on private companies employing carers, which unlike public sector employers such as the NHS have not been shielded from last year's National Insurance rise.

Jenrick suggested such firms should look to raise salaries to recruit British workers instead, adding that foreign nationals were doing "many doing jobs that the Brits should be doing".

The announcement comes ahead of a crucial by-election in Makerfield on Thursday, where Reform UK is hoping to head off a challenge from the right from Restore Britain, the fledgling party founded by ex-Reform MP Rupert Lowe.

On Sunday, leader Nigel Farage said Reform also wanted to ban foreign nationals from living in social housing, whilst the party last week also pledged a VAT cut for smaller businesses.

Conservative shadow chancellor Sir Mel Stride accused the party of "throwing out a litany of policies in the hope something sticks".

"In their desperation to try to win Makerfield, Reform are running the most reckless and expensive by-election campaign in history," he added.