The UK Government has scrapped a tax for employees who receive a coronavirus test through their work after political outrage.

Mel Stride, Tory MP and chair of the Treasury Commitee and the SNP's Alison Thewliss both called for the policy to be revised after HMRC published guidance on Monday.

It stated that tests offered by employers for their staff would be classed as a 'benefit in kind' and workers would face income tax if they receive them.

Mr Stride and Ms Thewliss both said yesterday that taxing workers would deter them from taking up the tests if offered, and stresed it could hit front-line workers the hardest as they have to receive more frequent tests. 

Mr Stride also wrote to Chancellor Rishi Sunak asking him to review the issue 'urgently'.

Now Mr Sunak has confirmed the tax will be removed in a letter to Mr Stride.

He said: "Following your question I have looked into this issue as a matter of urgency. 
"Regular COVID-19 tests are currently available through the Government testing programme to wide range of employees... If an individual is tested through the government testing programme, no tax liability will arise.

"This means that in the vast majority of cases, those who need to be tested have been and will continue to be able to access testing through the Government programme. 

"As you noted, at the moment the provision of a third party COVID19 test by an employer to an employee, constitutes a benefit in kind. Therefore, the cost of providing the test would normally be subject to income tax and Class 1A National Insurance Contributions (NICs)."

The Chancellor added that "most workers" could access the tests for free via the NHS, and so the tax would "only impact a small number of individuals."

He continued: " However, given the importance of widespread testing, the Government wants to ensure that all employers who wish to provide testing to their employees can do so without increasing their tax liability.

"We are therefore introducing a new income tax and NICs exemption from income tax for employer-provided COVID19 antigen tests. This will be in effect for any tests which have taken place during the current tax year 2020-21.  
"HMRC will amend their guidance as soon as possible to reflect this change."