Former minister Jim McMahon is calling on the government to urgently increase the HMRC mileage payment rate hitting frontline workers – including carers
Low-paid workers forced to use a car are being left out of pocket due to outdated HMRC rates, a senior Labour MP has warned.
Former minister Jim McMahon is calling on the Government to urgently increase the mileage payment rate hitting frontline workers – including carers. Currently employees forced to use their car for work can be reimbursed by 45p-per-mile. But the HMRC rate has not been updated since 2011.
In an article for The Mirror, Mr McMahon said: “Over that time, the cost of living has soared. Food, energy, rent and mortgages are all up, and so is the cost of running a car. For millions of people who rely on their vehicle for work, these costs are unavoidable.
“This does not just affect the self-employed. It also hits employees who are reimbursed for mileage by their employer. The very workers keeping our economy going are effectively paying to do their jobs, dragging real wages below the National Living Wage and deeper into the cost-of-living crisis.
“This is nothing short of a stealth tax on those doing the right thing and playing by the rules, sometimes leaving working people out of pocket by thousands of pounds.”
Unison and the RAC Foundation have previously estimated mileage allowance payments should be increased to 67p-per-mile. Mr McMahon added: “Labour is the party of working people. That is why I’m calling for government to instruct HMRC to finally refresh the mileage rate and show working people that they have a government on their side.”
Gemma*, 55, who has been doing social work for around two decades with children and families, sometimes travels for home visits at very short notice in the event of a crisis. She told The Mirror she travels around 300-500 miles a month for work.
She said increasing the rate “would make things a lot easier on the purse strings”. She said: “Putting it up to the rate would make things a lot more worthwhile. People lose a lot of mileage because we’re that busy dealing with the day-to-day tasks because there’s not enough staff at the moment, people don’t have the time to submit the mileage in time – so they actually lose out.”
In a message to the government, Gemma added: “Please listen to the people out who are actually doing the job. I don’t think we should be made to feel we’re begging for an increase in something that is badly needed. We’re doing this because we want to help people, so can you help us to keep doing that?”
Unison assistant general secretary Jon Richards added: “Frozen mileage rates have quietly shifted hefty costs on to workers. They’ve become a clumsy stealth tax while people are already grappling with soaring cost-of-living pressures.”
He added: “Public service staff who rely on their own cars to do essential work are thousands of pounds out of pocket simply for doing their jobs.
“An increase in the rate is long overdue and urgently needed. Staff are already working on a fairer deal within the NHS. But it’s the HMRC that needs to act with rates reflecting the real cost of driving, to stop workers subsidising employers from their own pockets.”
*Name has been changed to protect identity.