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The Conservative Party – What Does it Mean for British Businesses?

The recent Conservative Party Conference brought some welcome news for the UK’s business community in the form of Chancellor Philip Hammond’s commitment to British businesses.  In his speech, Hammond stated that the party backs business as “the cornerstone of a successful economy, as a force for good in our society and as an essential expression of our values”, claiming that the Conservative party is the party of business.

He went on to describe his support for the Be the Business project (more on this subject next week, so make sure you follow us on Twitter and Facebook to keep up to date).  He revealed his plans to make the apprenticeship levy more flexible and his commitment to the reskilling of the national workforce through a national retraining scheme in partnership with the CBI (Confederation of British Industry) and the TUC (Trades Union Congress). 

When it comes to the big boys, the global internet companies who often practise tax avoidance techniques in many countries around the world, Hammond wants to ensure that they make a fair contribution to public services and is considering imposing a digital services tax on them if they fail to voluntarily pay tax. This would be preferable than opting for an online sales tax which would place further burdens on retailers here in the UK.

Digital technology has provided huge gains in terms of innovative new companies and services, but it has also served to demonstrate how out of date the British tax regime is, with high street retailers being hammered by business rates just as shopping activity is moving online at an increasing rate. 

The news was welcomed by Adam Marshall, director general of the British Chamber of Commerce, who believes that Hammond is right to “champion the positive role that businesses play, day in and day out, across our communities”.  He went on to claim that this vital role has been overlooked by politicians from all parties. 

Meanwhile, the director of the Institute of Directors reiterated that there was plenty of positive news for businesses in the chancellor’s speech, particularly the plans for government to collaborate with employers to deliver the skills, opportunities and economic growth that Britain so badly needs as we face an uncertain future with Brexit looming.  He said that companies will welcome proof that ministers are listening to their concerns about the apprenticeship levy, going on to say that with Brexit on the horizon, businesses need both sides on the political divide to focus on minimising the friction for trade in future.

This was reinforced by the chief executive of the British Retail consortium, Helen Dickinson who highlighted the fact that a no-deal Brexit is not an option and we need smooth access to Europe to continue future growth.  Emphasising that our food supply chain relies on just-in-time practices which rely on frictionless trade with no border delays, she says it’s essential that the UK government reaches a workable solution to the Irish backstop rapidly so that the withdrawal agreement is made, with tariff-free trade protected during the transition period.   She welcomed the government’s commitment to reforming the business tax system via international agreement through the Organisation for Economic Co-operation and Development (OECD).