Labour Business vice-chair backs Single Enforcement Body and off-payroll rules reversal

Clues about what Spring Budget 2023 on March 15th would contain if the Labour party were in power are emerging.

In an online response to ContractorUK reporting on the Single Enforcement Body being side-lined, Labour Business’s vice-chair said he would lobby the party to get the SEB established.

In another measure contractors will likely support, more so if it didn’t represent a U-turn to the government U-turning its U-turn, Philip Ross also said he is going to push Labour to support “reversing” the off-payroll rules of 2017 and 2021.

'Employment status is out of date'

One of the original co-founders of the PCG, which before becoming IPSE was set up with the single aim of abolishing IR35, Mr Ross of Labour Business made the commitments last week.

Ahead of an exclusive article on the stance of Labour Business, which says it has been scrutinising UK self-employment policy for eight years, Mr Ross told ContractorUK: "Tax law is a mess, employment status is out of date.

"Vulnerable workers are being exploited, entrepreneurs are being impeded and swathes of the self-employed are excluded from support or are forgotten."

'Labour would surely increase dividend taxes'

But ironically, it isn’t the HMRC rule introduced in 2000 by a then-Labour-chancellor, Gordon Brown, which limited company contractors seem concerned about when discussing the prospect of the Tories losing the next general election (although the consensus seems to be that Labour would leave IR35 reform in place).   

“There isn’t really a [political] party to choose from,” reflected a contract manager. “[Because] Labour will increase dividend taxes to that of income tax rates.”

On a thread criticising chancellor Jeremy Hunt’s new growth plan, a self-employed test analyst echoed: “Agreed. I can't see Labour doing anything different from the Conservatives.”

'Tech Nation to cease operations'

An open goal for Labour if it wants to win the IT sector’s vote, would be for it to pledge to revive Tech Nation -- the industry body synonymous with ‘Silicon Roundabout’ which shuts next month.

A pet project of David Cameron when he was a Tory prime minister, the tech body blamed its decision to "cease operations" on the culture department withdrawing its funds and diverting them to Barclays.

Reportedly based on the bank’s Eagle Labs unit representing better value for taxpayer money, the withdrawal of Tech Nation’s funds came on Jan 31st -- just two working days after Mr Hunt reminded business leaders that he wants Britain to become the “next Silicon Valley.” 

'Tories consistently created pro-business environment'

“We are proud to be the party of entrepreneurship,” Brandon Lewis, former chair of the Conservative Party wrote in an article for the Telegraph, just 24 hours after Tech Nation’s funds were pulled.

Formerly the owner of a small family company, the Tory MP also claimed: “As a party we have consistently created a pro-business environment, allowing entrepreneurs to flourish.”

As a government, Labour says it would abolish non-dom status (a “tax loophole”), end tax breaks for private equity bosses, and end tax breaks for private schools.

'Same tax rules for all'

Based on the principle of “fairness in the tax system” – and the “same rules for all,” the proposals are about more than just raising much-needed money, according to Labour MP Abena Oppong-Asare.

Labour has also said in recent days that it would modernise job centres, and “stop the energy price cap going up” in April.

But in his published article last week, Mr Lewis may have let slip what businesses, contractors and other individuals should expect at Spring Budget in just six weeks.

'Threshold for VAT has not risen'

“Small business owners are worried about VAT. Despite rising costs, the threshold for VAT has not risen to reflect this,” Mr Lewis, a former Northern Ireland secretary wrote.

“Much like the personal tax thresholds, more and more small firms are thus being dragged into the VAT regime.”

Appealing to Mr Hunt directly about Spring Budget, Labour's shadow chancellor Rachel Reeves said it must not contain a rise in fuel duty.

'Pro-enterprise, pro-worker'

In a speech last Saturday to the Fabian Society, Reeves said a Labour government would be “pro-enterprise” and “pro-worker.”

To his followers last night, a tax investigation specialist -- Anthony Monger -- suggested that he’ll be backing ‘pro-change,’ when he next gets to cast his vote.

“What does Liz Truss have in common with Boris Johnson, Nadhim Zahawi, Matt Hancock and Dominic Raab?” Monger asked, in wake of Ms Truss announcing her political comeback.

“Yes, that’s right, a complete inability to recognise or admit to their errors, coupled with the tendency to blame it all on someone else.”

Taking to LinkedIn, a director appearing to refer to the lack of support for limited companies during covid, stated: “Can't wait for the next election to show them [the Conservatives] how much we think of their [‘supportive’] approach.”

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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