Coalition urged not to tax graduates twice

The coalition government has been urged not to make students rethink a university education by taxing graduates twice.

Steve Rooney, director at graduate recruiter Brampton Stafford Recruitment, gave his comments following business secretary Vince Cable’s address to the Lib Dem conference, in which Cable said he was doing everything he could to ensure graduate contributions are linked to earnings.

Rooney told Recruiter: “The whole purpose of income tax is to tax according to earnings. I don’t think it is fair to have two levels of income tax, one for non-graduates and another for graduates.

“It will put off some students from going to university due to the level of debt. That will cover middle class graduates and not just the under privileged students.”

Michael Rendell, head of human resource services at PwC, adds: “A variable graduate education contribution tied to earnings could put additional pressure on employers to ensure graduate employees are rewarded adequately, especially if recent University and College Union (UCU) estimates are accurate.”

But not all sectors are fearful of a graduate talent shortfall, says Darren Minshall, people director at McCann Manchester. He told Recruiter: “Media and marketing has always been an extremely popular and highly competitive career choice for graduates.

“There is fierce competition for a few vacancies and so we’re in the fortunate position that we can seek out the best creative talent. We feel that any contributions linked to earnings are unlikely to deter someone who has their heart set on any career in a creative industry - as money often isn’t the main motivator behind their career choice.”