The Association of Independent Professionals and the Self-Employed, the IPSE, believes the Chancellor could limit contracts to just a month for freelancers, after which they would be forced on to the client’s payroll.
Simon McVicker, head of policy and external affairs at IPSE, said: ‘The result would be businesses losing out on the expertise and innovation independent professionals provide. IPSE is very clear that this could cause catastrophic damage to the flexible labour market and the wider economy. The Government should not even be considering such an idea.’
Direct attack on smallest firms
IPSE argues this would be a direct attack on Britain’s smallest firms.
The Forum of Private Business expects to hear the outcome of the Government’s consultation on removing the tax relief that freelancers receive on travel and subsistence expenses on Wednesday.
It is urging the Chancellor to reconsider, as the smallest businesses are often hit by high costs when required to travel to and from clients’ premises.
IPSE research found that nearly one in five freelancers thinks removing the relief might ultimately put them out of business. It also places them at a huge competitive disadvantage to very large firms, which will still be able to claim the relief.
The Institute of Chartered Accountants for England and Wales has urged the Chancellor to leave small firms alone and its director of business, Stephen Ibbotson, said many are still coming to terms with changes from the post-Election Budget, such as the National Living Wage. ICAEW research found that 37 per cent of members expect the firms they work for to cut recruitment because of the Living Wage.
Ibbotson said: ‘Many of the businesses impacted agree that the reduction in corporation tax can’t offset the negative implications of measures announced in July. By not announcing any more bombshells in the Autumn Statement, the Government has a chance to give businesses the opportunity to plan with confidence for the longer term.’
Business rates
Last year the British Chambers of Commerce urged the Chancellor to use his Autumn Statement to address ‘spiralling’ business rate bills. It called for the Government to completely reform the busi- ness rates system by 2015, with a ‘new, more responsive and transparent system enacted early in the next Parliament’.
Last month the Government outlined plans to devolve significant control over business rates to local areas, which will see local councils retain all the revenue they collect in rates, and gain new powers to vary rates in some circumstances.
Apprenticeship levy
But BCC executive director of policy Adam Marshall said: ‘Reform of the business rates system has stalled. Ministers have focused too much on devolving rates powers, and too little on addressing the deep-rooted failings of an outdated and poorly-designed system that hits companies hard before they turn over a single pound.’ Meanwhile, the BCC is calling on the Government to provide clarity on the apprenticeship levy.
In a letter to Ministers, it has said ambiguity in the levy has led many firms to put investment and training plans on hold. The levy is supposed to help tackle skills shortages, but the BCC says that since it was announced there has been no more information on how it will work, how it will be set or on a definition of what constitutes a ‘large employer’ responsible for paying it.
