Each party has laid out its vision for supporting SMEs, addressing key issues such as taxes, funding, business rates, and regulations.
Here’s a breakdown of what the main parties are pledging and what it could mean for small businesses.
Conservative Party
The Conservatives have outlined a robust plan to support SMEs, focusing on reducing burdens and increasing support:
- Business Rates: Gradual increase in the multiplier on distribution warehouses to ease the burden on retail, leisure, and hospitality sectors.
- VAT: Keeping the VAT threshold under review to prevent small businesses from being adversely impacted.
- Finance Access: Expanding Open Finance and exploring regional mutual banks to improve access to finance.
- Employee Threshold: Raising the employee threshold for medium-sized business classification to reduce reporting responsibilities.
- Tax Incentives: Retaining incentives like the Enterprise Investment Scheme and Seed Enterprise Investment Scheme.
- Prompt Payment: Promoting digital invoicing and enforcing the Prompt Payment Code to tackle late payments.
- Invest in Women Fund: Establishing a £250 million fund to support female and disabled entrepreneurs.
Other significant policies include not raising corporation tax, increasing R&D spending to £22 billion per year, and abolishing the main rate of National Insurance for the self-employed by the end of the next parliament.
Labour Party
Labour’s manifesto emphasises economic growth and fairness, with specific measures to support small businesses:
- Growth and Skills Levy: Introducing a new levy to foster skills development and economic growth.
- Business Rates Reform: Replacing the current system with a fairer business property taxation system.
- British Business Bank: Reforming the bank to better support regional growth and provide more comprehensive funding.
- Procurement Rules: Reviewing rules to give SMEs better access to government contracts.
- Export Support: Improving guidance and removing barriers to help small businesses export their goods and services.
The Liberal Democrats focus on creating a stable environment for businesses with several key reforms:
- Business Rates: Abolishing business rates and replacing them with a Commercial Landowner Levy.
- Job Creation: Making it easier to create jobs and hire employees by reducing regulatory burdens.
- Environmental and Human Rights Duty: Introducing a duty of care for the environment and human rights in business operations.
- IR35 Reforms: Reviewing off-payroll working rules to ensure fair treatment for the self-employed.
- Local Banking: Working with major banks to create a local banking sector dedicated to SME needs.
Scottish National Party (SNP)
The SNP’s manifesto highlights several policies relevant to small businesses in Scotland:
- EU Reentry: Aiming for Scotland to rejoin the EU and the single market to ease trade.
- Maternity and Parental Leave: Increasing maternity pay and promoting shared parental leave.
- Employment Rights: Devolving employment rights to abolish zero-hours contracts and close the gender pay gap.
Green Party
The Green Party focuses on fair treatment for workers and supporting green initiatives:
- Workers’ Rights: Repealing anti-union legislation and ensuring equal rights for all workers from day one.
- Minimum Wage: Increasing the minimum wage to £15 an hour, with offsets for small businesses through reduced National Insurance payments.
- Four-Day Working Week: Moving towards a four-day working week to improve work-life balance.
Reform UK
Reform UK promises significant changes aimed at reducing regulatory and tax burdens:
- Corporation Tax: Increasing the minimum profit threshold and gradually reducing the main rate.
- VAT Threshold: Raising the VAT threshold to £150,000.
- Business Rates: Abolishing business rates for high street SMEs and introducing an online delivery tax.
- Employment Laws: Scrapping certain employment laws to reduce hiring risks.
Plaid Cymru
Plaid Cymru’s manifesto focuses on supporting Welsh businesses with several targeted policies:
- Business Rates: Amending the multiplier to better support high street businesses.
- Public Sector Spending: Aiming for 75% of Welsh public sector spending to be with local companies.
- High-Speed Internet: Guaranteeing high-speed internet connections for all businesses.
- Living Wage for Apprentices: Introducing a living wage for apprentices to support young workers.
By keeping an eye on these pledges, small businesses can better understand how the outcome of today’s election could shape their future.