The following essay was originally published on Courage Media.
On Monday, Britain secured a long-negotiated trade deal with India, lowering tariffs to add a projected £4.8 billion a year to the UK economy. But it came as a surprise to ministers when the Indian government's press release celebrated a tax exemption for their migrant workers on new “Skilled Worker” visas. Home Secretary Yvette Cooper was said to have been “kept in the dark” about these concessions made by civil servants, whose hands hover over the wheel of our self-driving state.
Just as Keir Starmer says he “gets it,” after voters punished his government at the local elections, he penalises them with a two-tier tax system.
Indian nationals will be exempt from paying national insurance (pensions and healthcare) tax contributions for the 3-year duration of their visa. This follows Chancellor Rachel Reeves breaking a manifesto pledge in the last budget by raising employer-side national insurance contributions. Reeves’ tax rise will cause a projected 25% of British businesses to make redundancies or restrict new hires.
British businesses are also no longer required to advertise roles in Britain to British workers first, thanks to Boris Johnson repealing the one good law passed by Gordon Brown. So, just as they raise the cost of employing British workers, the government incentivises ethno-nepotistic hiring of cheap Indian labour from abroad. Although Labour argue that 17 other nations have existing tax-exempt temporary visa deals, the political optics remain catastrophic.
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