The directors’ group said tax changes could encourage retraining

Sage Sunak has been urged to introduce a tax “super-deduction” for companies that invest in retraining workers, where there is a shortage of skills.

The Institute of Directors said there had been a “clear market failure” in training workers to meet labor shortages after Brexit and the epidemic. It called for a tax incentive to further encourage investment in the workplace.

In a speech at Bayes Business School last month, the chancellor proposed examining whether the tax system was doing enough to encourage businesses to invest in the right kind of training.

Britain lags behind its international counterparts in the technical skills of adults, with only 18 per cent of 25- to 64-year-olds having vocational qualifications.

The institute said members who did not wish to increase investment in skills training next year responded positively when asked if tax cuts would change their plans.

Kitty Usher, chief economist at IOD, said: “It is not tax-exempt to re-skill an existing team member as opposed to updating existing experts. There is also a risk that individuals, once re-trained in areas of lack of skills, are more likely to be victimized by competitors. This represents a clear market failure. “

The organization called for the use of apprentice levy funds to subsidize organizations for releasing individuals for overseas training in areas on the national skills deficit list. Jonathan Geldart, its director-general, said: “The sole reliance on apprentices as a policy tool does nothing to encourage companies to improve director-level and other types of management training.”


Leave a Reply

Your email address will not be published.