British business bodies have urged the government not to charge companies £1,000 ($1,207) per year for every skilled EU worker they employ after Brexit.
The Institute for Directors (IoD) and the Confederation of British Industry (CBI) made the intervention after immigration minister Robert Goodwill told a group of peers that he was considering the measure.
"That's something that currently applies to non-EU [migrants]," he said to the House of Lords' Home Affairs sub-committee. "That may be something that's been suggested to us that could apply to EU."
The so-called skills charge will come into force from April for non-EEA workers. The annual levy of £1,000 per-employee per-year, which is reduced to a rate of £364 for small or charitable organisations, is designed to incentivise businesses to train British staff.
"Companies are keen to work with the government to devise a new system for controlling EU migration that acknowledges public concerns while enabling businesses to succeed," said Josh Hardie, the deputy-director general of the CBI said.
"However, extending the system that currently applies to workers from outside of the EU – including the immigration skills charge – would neither meet the needs of our economy nor be appropriate."
Seamus Nevin, head of employment at the IoD, also urged the government to reconsider the proposal.
"Businesses are already working with ministers to improve the home-grown skills supply, but this tax will only damage jobs growth at a time when many businesses are living with uncertainty.
"They simply cannot endure the double whammy of more restriction and then, if they do succeed in finding the right candidate, the prospect of an extra charge."
Immigration policy is expected to be a major negotiating point of the UK's talks with EU, which will be triggered once Theresa May invokes Article 50 by the end of March.
The British government has indicated that it will seek curbs on EU free movement rules. But such a position could limit the UK's access to the bloc's Single Market after EU leaders, including European Council President Donald Tusk, ruled out "single market a la carte" for the UK.
Home Secretary Amber Rudd has recommitted the government to David Cameron's "tens of thousands" net migration target.
The latest Office for National Statistics (ONS) figures showed that EU net migration to the UK hit 180,000 in the year to June 2016, with a headline figure of 335,000 over the same period.
"As the minister said, there are a whole range of options we could consider to control immigration once we leave the EU," a Home Office spokesperson said.
"The people of this country spoke very clearly in the referendum and we are not leaving the EU only to give up control of immigration again.
"We will deliver an immigration system that reduces net migration to sustainable levels and truly works for this country as we leave the EU."