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17 March 2017

Weekly Brief 11 – Friday 17 March 2017

A wrap of the week’s small business news from FSB’s London Press, Policy and Public Affairs Office. To sign-up for Weekly Brief emails, please use this link 

Major U-turn on national insurance plan
As soon as news broke that Chancellor Philip Hammond was scrapping a planned hike on Class 4 National Insurance Contributions (NICs), FSB issued a response. We campaigned hard against the tax grab, with many members also getting involved and writing to their local MP. FSB’s voice in Government was clearly heard and the move marks a victory for our economy’s strivers and risk-takers. Self-employment remains fundamentally different to employment, and the self-employed still face many challenges. We are engaging with the Taylor review on this. Coverage on this issue included Daily Mail, Daily Telegraph, Daily Express, BBC News Channel, Sky News, Talk Radio and The Times.

As it happened in Parliament
On Monday, during a House of Commons debate on the Spring Budget 2017, Liz McInnes MP (Lab, Heywood and Middleton) cited FSB’s opposition regarding proposals for a NICs increase on the self-employed, quoting our position that ‘it should be seen for what it is—a £1 billion tax hike on those who set themselves up in business.’ This debate continued on Tuesday, and Martin Docherty-Hughes MP (SNP, West Dunbartonshire) read out a section of a briefing sent to him by FSB; ‘The risk that the self-employed face makes them fundamentally different to employees. This is why the proposed National Insurance tax grab on this group is an absolute kick in the teeth, just at a time when we need to create more entrepreneurs, not fewer.’

On Tuesday during a House of Lords debate on the Spring Budget 2017, Lord Northbrook (Con) also quoted FSB’s opposition to the NICs increase, and quoted us when welcoming the delay in mandatory quarterly tax reporting for smaller businesses with a turnover below the VAT registration threshold.

During oral questions to the Department For Business, Energy and Industrial Strategy on Tuesday, Bill Esterson MP, the Shadow Business Minister, quoted FSB’s press release ‘37 problems and tax is one’, saying ‘proposed National Insurance tax grab on this group is an absolute kick in the teeth, just at a time when we need to create more entrepreneurs, not fewer’. He then asked Margot James, Small Business Minister, whether she should consider doing what FSB suggests in the future. In the same debate. Margot James pointed out that FSB was regularly engaging with the Department for Exiting the European Union when asked by David Nutall MP, (Cons, Bury North) what steps is the Minister taking to consult small businesses on potential deregulation after leaving the EU. Again in that debate, Business Secretary Greg Clark was asked what he is doing to ensure that SMEs are consulted on the Industrial Strategy. Greg Clark responded that his department has ‘regular discussions with the Federation of Small Businesses … right across the country.’

In Prime Minister’s Questions on Wednesday, Leader of the Opposition Jeremy Corbyn stated that the Prime Minster ‘should thank the Federation of Small Businesses’ for pointing out the unfairness in the NICs rise.

On Wednesday, the Chancellor made a statement in the House of Commons stating that he would not take forward the planned NICS rise. In the debate following, Shadow Chancellor John McDonnell included FSB when discussing those that helped force the reversal. In the same debate, Robert Courts MP (Cons, Witney) welcomed the announcement, ‘as a member of the Federation of Small Businesses.’

Cross-party committee calls for MTD delay

FSB has welcomed an influential House of Lords committee report, which calls for a delay in the launch of the Government’s Making Tax Digital programme until 2020. The cross-party Economic Affairs Finance Bill Sub-Committee has also recommended that the smallest and most vulnerable businesses are exempt from plans to force companies to report on a quarterly basis. Read our full response. This was covered by The Times and Daily Mail.

Employment figures stable
There are 31.85 million people in work, a figure largely unchanged from the previous three month period. The number of self-employed people has increased by 148,000 since this time last year, with the self-employed totally 15.1 per cent of all those in work. Read FSB’s response.

Is sustainability at the core of your business operations?
As part of the Finance for the Future Awards, ICAEW and the Prince of Wales founded the Accounting for Sustainability Project. Small firms interested in this area can enter the Start-up/Growing Enterprises Award which recognises financial leadership in building sustainable economies. The awards are free to enter and open until 5 May 2017.

Register to vote
Local elections are taking place across Wales, Scotland and parts of England on 4 May 2017. To make your voice heard, it’s important you register to vote. Check out this step-by-step guide to registering online. You can be part of the campaign to encourage voter enrolment by downloading this resource pack.

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