Reform UK has proposed a new tax policy aimed at companies that employ foreign workers, pledging to introduce what it calls an “employers’ migrant labour levy” if it wins the next general election. Announced by Robert Jenrick, the party’s treasury spokesman, the policy is designed to encourage firms to hire British nationals by imposing additional costs on the employment of foreign staff.

Under the plan, companies would face an annual fee for each foreign worker they employ, with the levy potentially raising more than £11 billion. The revenue generated is intended to fund a reduction in employers’ National Insurance Contributions (NICs) — cutting the rate from 15 percent back to 13.8 percent — but only for British workers. Jenrick said the proposed system would create financial incentives for businesses to replace migrant labour with British workers, who he described as “currently languishing on benefits.”

While specific levy amounts have not been finalized, Jenrick suggested hypothetical figures: roughly £3,750 per year for foreign full-time workers earning the minimum wage of approximately £24,784, reduced amounts for higher earners, including £1,500 for those on £50,000 and £500 for workers earning £100,000 annually. He avoided giving exact rates, citing the premature timing given the next election is still up to three years away.

Jenrick criticized previous labour policies, arguing that the reliance on low-wage migrant workers has suppressed wages and negatively impacted the quality of life for British workers. He asserted that for over two decades, British employees have been placed second in the labour market under this system. The new levy, he stated, would prioritize British workers and reverse what he described as a failed experiment in immigration and labour policy.

The Conservative Party, through Shadow Chancellor Sir Mel Stride, dismissed the proposals as unrealistic and emblematic of a party relying on headline-grabbing ideas rather than credible plans. Stride described the pledges as “entirely uncosted” and accused Reform UK of engaging in political gimmickry without a serious strategy for governance.

Labour also criticized the plan, labeling it as “half-baked” and warning that it would have detrimental effects on both British businesses and workers. The party raised concerns about the potential economic consequences of targeting companies that employ foreign workers, which could include disruptions in certain sectors reliant on migrant labour.

The debate highlights the ongoing discussions around immigration policy, labour market dynamics, and how governments can best support employment for domestic workers while balancing the role of migrant labour within the UK economy. Reform UK’s proposal seeks to reshape this balance, positioning British workers as the priority in employment practices.