BUSINESS leaders have demanded a referendum on plans for a workplace parking levy in Nottingham amid claims the Government wants the charge passed on to workers. Nottingham City Council is progressing with plans to introduce a levy to help pay for expansion of the tram network – a move it says is vital to boost the economy.

The council has always insisted the charge should be paid by businesses in the city, rather than the staff who use the spaces.

But a campaign group led by Derbyshire and Nottinghamshire Chamber and the East Midlands CBI says the Government has hinted it wants to see the charge passed on to employees.

It made the claim after a meeting in London between the British Chambers of Commerce and officials at the Department for Transport.

It says DfT officials has said any levy aimed at cutting road congestion should be created in a way that changed people's behaviour.

Campaigners say this could only be achieved if workers rather than businesses paid – and that there should therefore be a public referendum.

Chamber chief executive George Cowcher said: "Nottingham City Council has continually referred to its Workplace Parking Levy as a tax on employers. Clearly Government wants employers to pass this tax onto staff.

"In response to an ongoing survey on our website, just over 50% of respondents said they would pass the burden. In the current economic climate only 13% had indicated that they would definitely absorb the cost."

Following the news that people in Manchester voted against the introduction of a proposed congestion charge for the city, Mr Cowcher is calling for the people and businesses of Nottingham and Notts to be given the chance to vote in a referendum on the new tax.

Mr Cowcher said: "The levy has been touted as an alternative to the congestion charge but research has shown that it would do little to cut congestion and is merely another way of taxing businesses and jobs.

"In light of the Department for Transport's views and the decision in Manchester, now is not the time to place further burdens on businesses and people. There should be a ballot on the proposed workplace parking levy scheme in Nottingham."

Coun Jane Urquhart, Portfolio holder for transport and area working, at the city council, said employers would have a choice as to whether they paid the bill themselves or passed it on to employees.

She told Business Post that a consultation exercise, when the WPL was first discussed, suggested that most people were in favour.

"The people of Nottingham have already had their say on the council's proposals for a workplace parking levy," she said.

"The council embarked on a major consultation exercise in 2007 with businesses throughout the city and members of the public.

"As part of this consultation there was also a five-day public examination of the WPL proposals by an independent chairman in October of that year. Sixty-eight per cent of Nottingham city residents who took part in the consultation supported proposals to introduce it.

"The proposals for a WPL have also been included in the Labour Group's manifesto for the last three consecutive local elections. Therefore, the council believes it is unnecessary for yet another vote by way of a referendum.

Coun Urquhart said existing legislation made it clear that businesses would pay the levy, not their employees.

She added: "The consultation on the regulations very clearly states that 'as a principle aim of the levy is to provide an incentive to employers to discourage car commuting … the regulations have been drafted with the intention of assigning responsibility for applying for a licence and paying the levy to the business which actually makes parking places available to its employees'.

"Since Nottingham City Council announced its proposals for a WPL, it has said all along that employers will have the option of passing the cost of the levy to the employee if it so chooses. The consultation on the regulations is clear that this remains the case.

"The WPL is intended to help fund of a package of transport improvements and, indeed, the legislation requires that the levy income can only be used for transport improvements.

"Together, these transport improvements are predicted to reduce traffic growth from 15% to only eight per cent. The predictions indicate that the number of public transport journeys in and out of the city centre would increase by 20% and the demand for park and ride would increase by 45%.

"During the current economic climate, it is more important than ever to help stimulate economic growth. The WPL package will play a key role in attracting new businesses to Nottingham and securing a bright and sustainable future for the city."