E-minister angers contractors over IR35

But the Professional Contractors Group (PCG) has rejected this and slammed the 'uncertainty' that the majority of UK contractors feel. However, they welcomed Hewitt's words as an indication that the Inland Revenue will be taking a 'more clear and relevant' view of contractors in light of the recent High Court decision.

Hewitt said in a chatroom interview on Friday: "I think a lot of people who thought that IR35 would hit them are pleasantly surprised to find that they really are self-employed - in the eyes of officials as well as themselves.

"Last year, everyone was saying IR35 would cause thousands of IT professionals to flee the country. It just hasn't happened - perhaps because Germany, Australia, the US and many other countries are also taking the same step to have fairness in the tax system."

The PCG feels that the government doesn't understand the full extent of the problem

Suzi Hughes, PCG spokesman, said: "We have 300 case studies - and for every one of those there are 10 to 20 others we don't know about. The government isn't monitoring it, but we are.

"Soon we will have finished giving seminars to 1,000 contractors and their questions reveal their worries over the uncertainty about their status. The High Court action showed that the Inland Revenue had its implementation wrong. We can only hope that Hewitt is right and that the IR is about to change its guidelines."