Conservatives' support for Contractors
The Tories will soon be publishing new measures that they propose will save £14bn per year.
These savings are expected to come from removing large amounts of outdated, unnecessary and excessive legislation. Former cabinet minister John Redwood will be putting together wide-ranging measures to tackle what are perceived to be excessive regulations imposed by Whitehall and Brussels.
In addition to changes to working hours, and employee protection, it is believed that they will also be reviewing the IR35 intermediary’s legislation. There is increasing speculation that they could propose to scrap it completely.
Although the Tories have always apposed its introduction, since 1999, they have in recent times relaxed their approach to one of ‘reviewing the situation’, rather than abolishing it.
According to some reports the new measures would look to abolish IR35 and return the small companies corporation tax rate back to 19%, and review anti-avoidance rules for managed service companies.
The contractor’s champion, PCG said “We hope that the party will adopt proposals to do this, and abolish IR35 accordingly – once employment status is truly clear, IR35 will be unnecessary.'
The amount of tax that IR35 has raised has never been quantified by the Revenue. In recent years the Revenue’s track record against IR35 cases has been very poor. However, this does not take into account those who have voluntarily accepted IR35 and paid the tax to the Revneue.
With rumours of an early general election being called by the Prime Minister, Gordon Brown, and the defeat of Government in the ‘Jones – V – Garnet’ case could it be that the Conservative party have decided to obtain an early advantage with the business sector!
What ever the outcome, it remains to be seen whether pre-elections promises will will prove fruitfull or fruitless IF the Tories win the next Genreal Election.
Other proposals John Redwood is expected to announce later this week include:
· repealing working time directive and data protection laws;
· deregulation of some financial service provisions, including money-laundering restrictions affecting banks and building societies, and mortgage provisions;
· changes to onerous health and safety regulations;
· simplified regime for submitting tax records;
· abolition of the Home Information Packs (HIPs).
