The Federation of Master Builders, the construction industry 's largest trade association, backed today's decision by Her Majesty's Revenue and Customs (HMRC) to postpone the proposed new Construction Industry Scheme (CIS) by one year.
The proposed new scheme, which aims to bring real benefits to the industry, has been under discussion since November 2002. While progress has been made, decisions on employment status, IT systems and enforcement protocols remained unresolved.
In recent months, the construction industry had been increasingly concerned that HMRC would launch the new CIS before it was ready. As talks with HMRC were not progressing, the industry felt it had no choice but to leave the negotiations in order to show HMRC the seriousness of the situation.
Speaking after the announcement, FMB Director General Ian Davis said "We are pleased that the government has listened to the concerns of the construction industry, as well as of the IT and accountancy sectors, and has agreed to defer the introduction of the new CIS by a year."
He added: "Had the new CIS started in April 2006, the result would have been chaos for the industry and potentially the closure of many businesses with the loss of large number of jobs.
"We regret that it has been necessary for the major part of the construction industry to walk out of negotiations with HMRC in order for our views to be heard. However, we now look forward to working again in partnership with HMRC to ensure that the new CIS scheme, when implemented, meets the needs of both the construction industry and the government," Davis concluded.
First posted: 20 October 2005. Last modified: 20 October 2005.
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