Tax break to boost study of the basics;FE Focus

Ian Nash

BIG tax concessions for employers and their staff who sign up for basic college courses will be announced by the lifelong learning minister George Mudietoday.

The investment laws will be reformed to create new tax breaks for those who have Individual Learning Accounts - funds to encourage employers, individuals and the Government to invest jointly in lifelong learning.

Employers who contribute to ILAs will do so tax free. Employees who use them for training will also escape all the usual taxes on benefits and company perks.

The plans will be unveiled at the annual conference of the National Institute of Adult Continuing Education in Loughborough. The tax breaks will add to huge discounts already pledged for those who use ILAs for training.

The first million ILAs come into operation next week and adults who use them to sign up for basic skills courses will get discounts of 20 per cent - up to pound;500.

Alan Tuckett, director of NIACE, said: "It still leaves a lot of questions open. The key issue is whether the accounts can be used for as generous a curriculum range as the old-style vocational tax relief."

Mr Mudie could face a hostile reception from adult education leaders over the Government's decision to abolish relief for those without ILAs.

At present those who sign up for vocational training can claim 23 per cent income tax relief on fees. In the Budget, Chancellor Gordon Brown abolished the concession which, he insisted was abused by people who claimed for non-vocational courses such as "scuba-diving and flying lessons".

Mr Tuckett said: "Suddenly two years into the Government's life we are back to the view that public subsidy should be limited to courses with a vocational output. This is exactly the argument that led to regular forays by Inland Revenue trying to tax learning for pleasure."

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Ian Nash

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