Govt confirms introduction of Immigration Skills Charge

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Companies will face a new levy on skilled staff from overseas

The Department for Business, Innovation and Skills (BIS) has confirmed the government is to press ahead with the introduction of its potentially controversial Immigration Skills Charge (ISC).

Set to be introduced from April 2017, the ISC will aim to incentivise employers to invest in the training of homegrown talent to fill skills shortages, rather than rely on bringing in already-trained professionals from overseas.

The levy will be applicable to businesses that employ non-UK nationals in skilled positions at a flat rate of £1,000 per employee per year (reduced to £364 per year for small or charitable organisations).

There will, however, be a range of exemptions, which the government believes will help to continue the inflow of international students and retain the services of the brightest and best foreign workers in the UK.

Companies are assured that the ISC will not apply to PhD-level jobs and international students switching from student visas to working visas.

Outlining the government's position, universities and science minister Jo Johnson said: "This important charge delivers valuable flexibilities that will help to address skills shortages while ensuring the UK remains a leading knowledge economy and popular destination for international students."

Ministers now hope that the introduction of this new levy will ensure more businesses are investing in the training of skilled staff, helping to reduce the inflow of skills from abroad and ensure key shortages in industries across the nation are addressed in the years ahead.

By charging firms for professional skills in this manner, it is believed the costs associated with training will seem minimal in comparison.