Labour announces plans to help SMEs
The Labour party has revealed a number of plans to help small firms if it wins the general election, including replacing business rates with a land value tax and forming an agency to help small businesses seek expert advice and bid for government contracts.
One of the party’s measures will be the development of a group of small business advisers who can be accessed via Post Office branches, while it also plans to offer a specialist website for supporting small firms, free fibre broadband to every business by 2030 and establish a £250 billion national investment bank which will be responsible for loaning money to businesses.
Labour shadow business secretary Rebecca Long-Bailey said that global corporations that “evade taxes” and “fail to pay their suppliers on time” are seeing smaller companies “stretched to breaking point.”
Long-Bailey said: “Labour wants business support and finance to be available for entrepreneurs from the moment the seed of an idea is planted.
"Labour's Business Development Agency will create thriving businesses within our communities, bringing life back to local economies.”
The Federation of Small Businesses responded warmly to Labour’s plans, but chairman Mike Cherry warned that the party's proposed tax changes to dividend payouts requires further clarity.
Cherry said: "The party promised that no business owner making less than £80,000 would be targeted if it wins power. But, as things stand, it's hard to see how that will be the case."
The Conservatives, who have promised to reduce business rates for SMEs and provide discounts on National Insurance payments, have criticised Labour’s plans, including its commitment to raise the corporation tax rate paid by small companies by 2023-24.
International trade secretary Liz Truss said that Labour is “not on the side of small businesses” and that Britain’s SMEs “need certainty” as opposed to “a new quango”.
The Tories have also taken aim at Labour’s desire for a 32-hour working week within a decade, which they claim would “hit businesses hard”.
Truss added: “All Corbyn’s Labour will bring is higher taxes and uncertainty with no plan for Brexit”.
Liberal Democrat business spokesman Sam Gyimah said that Jeremy Corbyn’s Brexit policy “has dropped any pretence” of the party being pro-small businesses, dubbing Brexit the “most anti-business policy of all”, while other Labour policies seek a “return to plans from the 1970s to take over company shares and nationalise swathes of the economy”.
Gyimah added: "It is only the Liberal Democrats who will stop Brexit and bring forward a bold vision to support small businesses in the UK.
“Smaller firms have made it abundantly clear that any form of Brexit - be it red or blue - will harm their ability to hire staff, make it more difficult to export to our closest partners and ratchet up the cost of doing business".
Lib Dem policies include bringing in a new levy on commercial properties based on land value to replace business rates, alongside a “start-up allowance” to help businesses get to grips with their accommodation expenses.