RMT respond to Tonnage Tax reform reports

RMT respond to Tonnage Tax reform reports

16 December 2020

RMT Press Office:

Shipping Union RMT today responded to press reports that the Government will use Singapore as a model for its planned reform of the Tonnage Tax scheme.

RMT research shows that shipowners in the Tonnage Tax scheme have already benefited from subsidies worth £2.165bn since the scheme was introduced in the early 2000s. The number of UK Ratings employed on vessels in the scheme has flatlined and only 75 Ratings have been trained since 2015.

RMT General Secretary, Mick Cash said:
“The Tonnage Tax has subsidised shipowners to the tune of £2.165 billion but trained only 75 UK Ratings, with UK Ratings jobs on non-UK flagged ships in the scheme virtually non-existent. We agree that major reform is needed to secure a far better deal for UK Ratings and Officers from this consistent level of taxpayer subsidy. It would be nice to be consulted about these proposals, rather than reading about them in the press.

"If reports are accurate, however, then the Government is planning a post-Brexit race to the bottom, protecting international shipping interests ahead of investment in training and skilled seafarer jobs in this country.

"The crew change crisis underlines the need for a quality Red Ensign, not a Flag of Convenience competing with city states like Singapore or Hong Kong. The Government must come clean with all the maritime unions on their plans.”


Notes to Editors
1.       The Tonnage tax scheme contains a mandatory link to training UK Officer Cadets. There was a voluntary link to Ratings training until 2015 when a minor reform to include Ratings as part of the mandatory complement was agreed between Government, trade unions and industry. This reform was also in line with a recommendation made by the Transport Select Committee in March 2014. 
2.       Current Tonnage Tax employment statistics are commercially confidential. RMT  evidence to the Transport Select Committee’s 2013-14 Inquiry into the Government’s Maritime Strategy stated:  UK ratings only account for 40% of  [all]  ratings working on UK flagged vessels in the scheme and 0.02% of ratings jobs on non-UK flagged Tonnage Tax ships.
Tonnage Tax – subsidy and Ratings training analysis
Financial year Tax relief (£ m)
Number of Ratings trained [1]
2000-013 60 No figures
2001-023 65 No figures
2002-033 70 No figures
2003-043 80 No figures
2004-053 90
No figures
2005-06 90
No figures
2006-07 100
No figures
2007-08 170
No figures
2008-09 225
No figures
2009-10 95
No figures
2010-112 100
No figures
2011-12 115
No figures
2012-13 100
No figures
2013-14 100
No figures
2014-15 95 No figures
2015-16  100 6
2016-17  115 13
2017-18 135 31
2018-19  125 25[2]
2019-20[3] 135 No figures
Total £2.165 billion 75 Ratings
1 Written Answer to PQ247013, 5 th May 2019.
2 Written Answer to PQ1659, 17 th October 2019.
3 Forecast HM Treasury  Estimated Cost of Non-Structural Tax Reliefs (Corporation Tax) October 2020

[1] Written Answer to PQ247013, 5 th May 2019.
[2] Written Answer to PQ1659, 17 th October 2019.
[3] Forecast HM Treasury  Estimated Cost of Non-Structural Tax Reliefs (Corporation Tax) October 2020

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Tagged with: Tonnage Tax, Shipping, Ratings