Selective Employment Tax

Selective Employment Tax (SET) was a weekly payroll tax in the United Kingdom. It was levied against employers at a flat rate of 25 s per man, and 12 s 6 d for women.[1]

SET was intended to subsidise manufacturing industry from the proceeds of the services industries, to help exports. At the end of each accounting period, manufacturing companies would have their SET payments refunded, along with a 7s 6d bounty per employee.

SET was designed to be a tax on those companies that did not boost UK exports. High-street bookmakers used the introduction of this tax as a reason to reduce the payout on some each-way bets (where a horse is placed in the first two or three, depending on the number of runners) from a quarter the odds to a fifth the odds. However, the previous, larger payouts were never restored when the tax ended.

This tax was introduced during the first Wilson ministry in 1966, by means of the Selective Employment Payments Act 1966. It was dropped in favour of the introduction of VAT by the Heath ministry of 1970-1974.[2]

References

  1. ↑ Winder, George (1 March 1967). "The Selective Employment Tax". Foundation for Economic Education. Retrieved 25 February 2014.
  2. ↑ "Reform and VAT". The Cabinet Papers 1915-1984. The National Archives. Retrieved 25 February 2014.
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