Taxing times while Westminster uncertainty continues

Summer recess is traditionally a time for reflection among MPs, an opportunity to engage with constituents and take a bit of a break from the Westminster merry-go-round. Not so this year, however.

Since parliament broke up at the end of July, the new Prime Minister has dominated the news with a blitz of policy announcements. More money for the NHS, a tougher stance on law and order, greater devolution for the North, and a new immigration policy have all been touted. Our new Chancellor has also been making positive noises, musing that he is a “low-tax guy” in an interview with The Times.

On Brexit, the government’s strategy has become slightly clearer. In a letter this month, Mr Johnson made clear he wants the EU to remove the controversial Irish ‘backstop’. Beyond this, the main action of the government in the last month has been to ramp up the rhetoric and preparations for No Deal. The purpose appears to be two-fold. While it theoretically increases the pressure on the EU to make a concession, it is mostly aimed at forcing the Commons to bring the issue of a Vote of No Confidence (VNC) to a head in early September.

All bets are off on how the parliamentary machinations may evolve in the event Johnson loses that vote, particularly as the opposition parties struggle amongst themselves to agree on who would lead a government of national unity. But the upshot is that the possibility of an election seems higher than ever. Indeed, the issues that the PM have highlighted in his first weeks in office seem designed with that outcome in mind. It is also no surprise that in a speech on Monday (August 19), it was Jeremy Corbyn’s turn to road-test some policies on the NHS, tuition fees and the living wage.

But while Brexit continues to crowd out other topics, at IPSE we are continuing our busy programme of events, reports and discussions to raise the profile of the self-employed. In September, we will be attending and hosting discussions at the political party conferences. Across a series of meetings and fringe events, our team will be making the case for freelancers and bringing their issues to the attention of politicians and policymakers.

Our big concern remains the rollout of IR35 to the private sector. As our response to Bob Neill MP’s recent comments on the Loan Charge debacle lays out, IR35 is at the heart of our badly broken tax system and continues to cause problems. IPSE continues to lobby government to change tack and we are encouraged by the Chancellor’s recent statement that he wants to simplify the tax system ahead of his first Budget. We will be feeding in our thoughts in to the Treasury on behalf of members in our pre-Budget submission in the autumn.

A parting thought for the Chancellor and indeed all MPs came this month in the form of the ONS’s latest statistics showing there are now 4.97 million self-employed in the UK. If an election does come about, that is almost 5 million voters that the parties would do well to think about – Deal or No Deal.

Meet the author

Simon McVicker

Director of Policy