IT Contractors Express Support For Services Directive

by Robin Pilgrim, LawAndTax-News.com, London

31 March 2005

According to reports in the national media, the UK's IT contractors were disappointed by the European Commission's recent decision to reconsider certain provisions of the proposed services directive, arguing that as introduced, the legislation would have made it easier for them to offer their services across the EU.

Speaking to ComputerWeekly, chief executive of the Association of Technology Staffing Companies, Ann Swain suggested that being able to pay their taxes in the UK would have been one of the key advantages of the disputed 'country of origin' principle for IT contractors.

"More contractors would offer their services via agencies across Europe if the tax situation were easier to comprehend and less expensive, and if they could still pay UK tax," she observed, continuing:

"The UK is better placed that most EU states to take advantage of this directive. Having one of the largest temporary workforces and most developed staffing industries in Europe should give us a headstart over competitors."

The ComputerWeekly report went on to suggest that the IT industry is concerned that the sector will be exempted from the country of origin principle if this is requested by France or Germany, the two member states that have expressed the strongest objections over the directive.

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