What the leaked Labour Party manifesto means for small business owners
A draft oflabour’s election pledges has been leaked to the press. While it remains to be seen which policies will feature when the official document is released, the leaked Labour Party manifesto has given theclearest indication yet of what Britain would look like for small UK business owners under a Jeremy Corbyn-led Labour government.
Here, weve brought together the potential policies set to affect small business owners should the party win the general election in June.
Corporation tax increases
According to the leaked Labour Party manifesto, a Corbyn-led government would increase corporation tax from 19 per cent to 26 per cent.
The sevenper cent corporation tax hike is at odds with guarantees Corbyn made at the Federation of Small Businesses (FSB) conference in April, when hetold FSB members there would be no tax increase for the smallest firms.
Responding to the potential corporation tax increase, an FSB spokesperson said: We are pressing Jeremy Corbyn to honour the commitment he made when he met with FSB members last month, for no increases to corporation tax for small businesses under a future Labour government.
However, Corbyn has maintained that only the biggest companies would see the full rate increase.
Speaking at a Labour Party event in Leeds on 10 May, Corbyn said small UK businesses were the backbone of our economy, while a Labour government would restore small profits rates and make only a modest increase? to corporation tax.
The Labour leaderadded UK corporation tax would remain at the lowest group of the seven most industrialised countries.
Under the current government, corporation tax would drop to 17 per cent by 2020.
The leaked Labour Party manifesto also pledged a blanket ban on zero-hour contracts, while unpaid internships could also be ended.
Labour’s stance on flexible working has been criticised as anti-business? and an attack on the flexible economy by the Conservative Party.
Commenting on the draft policies, Alan Price, HR directorof Peninsula, said the party looked set to “clamp down on bogus self-employment”.
“Labour wishes to introduce a new statutory definition of employment status, reducing tribunal litigation and increasing understanding as many employers struggle with current case law definitions and applying these to their workforce.
“Labourwould also shift the burden of proof in proving status. This means that all workers would automatically be assumed to have employee status and the employer would have to take steps to prove otherwise, ” Price explained.
Labour could also strengthen paternity rights of employees. New fathers would see leave doubled by four weeks, with pay increases also marked.
Corbyn recently suggested statutory bereavement leave could be introduced for workers losing a family member.
The minimum wage would rise under a Labour government to at least 10 per hour by 2020, keeping it in line with the National Living Wage.
Late payment cap
The leaked Labour Party manifesto confirmed plans recently announced by Corbyn to introduce a cap on late payments to support small suppliers.
To hold big businesses to account, the party would introduce a 30-day deadline for invoice payments. At the FSB conference, Corbyn claimed bigger clients were holding cash piles? that rightfully belonged to suppliers.
Regional development banks
Labour would introduce a publicly financed National Investment Bank worth 250bn to support British infrastructure.
The money would be used to provide loans to smaller firms through new regional development banks.
Praseeda Nair is the editorial director of Business Advice, and its sister publication for growing businesses, Real Business. She's an impassioned advocate for women in leadership, and likes to profile business owners, advisors and experts in the field of entrepreneurship and management.
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