Labour betray British workers as India trade deal means it's £11k cheaper to hire migrants

Labour has been accused of ‘betraying’ Britons after new data suggested their trade deal with India means businesses could save thousands by bringing in Indian workers. Keir Starmer paraded the deal as a major boost for Britain and its economy. However, a big concession on tax may damage British employment prospects.

Labour agreed to a ‘Double Contribution Convention’ (DCC) with Prime Minister Modi, which means Indian businesses will not have to pay National Insurance Contributions to the Treasury on Indian workers seconded to Britain. The Tories have now calculated that this could mean tax cuts of thousands of pounds for each Indian worker brought over by firms. This includes a whopping £11,168 tax reduction for a business seconding a software engineer from Delhi instead of Doncaster.

Reacting to the findings, shadow Business and Trade Secretary Andrew Griffith said: "Labour's two-tier tax breaks for Indian secondees risks costing hardworking Brits dear.”

"It could mean fewer opportunities and lower salaries for British workers.

"Two-tier Keir won't stand up for our country and can't deliver for the British people. Britain deserves better.”

In a further example, an Indian firm bringing over an IT adviser from Bangalore would save as much as £7,211 compared to hiring someone with the same skills from Birmingham.

In this example, the IT adviser in India would be paid an average of £12,000, versus the average British salary of £52,000.

That worker’s social security bill in India - their NICs equivalent - would be £2,889 compared to the British workers’ £10,099 to the Treasury.

Even when accounting for the immigrant health surcharge fee, this business would save over £6,000 by hiring the Indian worker and seconding them to Britain than if they hired a domestic British worker.

The tax savings are largely down to the much lower average salaries for key jobs in India, where an IT advisor is payed on average £35,000 a year less than in Britain.

While a Treasury spokesman denied the calculations, the department this week said it planned on covering up the true cost of the tax giveaway for British businesses.

A freedom of information request by the Express revealed that the Treasury does hold estimates of the cost to British taxpayers, but are using excuses to avoid publishing them.

The Indian Government led their celebrations of the new trade deal by describing the DCC agreement as a “huge win” and an “unprecedented achievement”, while the UK Government attempted to underplay the concession.

Delhi said the agreement would “make Indian service providers significantly more competitive in the UK”.

On top of the enormous tax concession, the Home Office also agreed to add chefs, yoga teachers and musicians to its list of essential workers, as well as their dependents.

A Government spokesperson said: “This is not true. Indian nationals will not receive a tax break, and the agreement is restricted to a small number of highly-skilled, highly-paid professionals on temporary visas.”

“Our trade deal with India brings a big boost for British businesses and workers, growing our economy by £4.8 billion and increasing wages by £2.2 billion every year - putting more money in working people’s pockets across the country as part of our Plan for Change.”