The one th9ing that the government should do to kickstart growth is to abolish the IR35 tax rules.
IR35 killed the independent contracting sector in the UK almost overnight. I was caught up in the early adoption of the rules, being an independent I.T. contractor, but the IR35 rules have been widened to incorporate the media and medical staff like doctors working privately.
I do get why they were introduced: the then Labour government wanted to stop companies letting people go and re-hiring them as self-employed contractors, thereby avoiding the payment of employer's national insurance amongst other things.
But if they wanted to target that, they should have made the rule that if you originally worked for a company as a PAYE employee, you couldn't return to that company as an independent contractor for 6 months or whatever.
But, instead they made the rules catch ALL independent contractors, whether they were working for the company or not, whether they worked for the company in the office or not. Even if you worked one day in the office, you are classed as a "disguised employee".
Media people, who may have their own PLC and work for several media companies doing different things, if they sit at a desk and read the news, or sit at a desk and edit a programme, they fall foul of IR 35. The taxman deems them as employees.
This is the creep of tax mentality, the same that has deemed those in the gig economy to be employees as well. It's wrong-headed. If the people start to work as self-employed independent people, how can they then later down the line campaign to force the company to recognise them as employees with paid leave etc?
We need freedom in this country and especially the freedom to work as and how we please. By restricting employment freedom, the government and HMRC have stifled growth. Not for nothing has growth in the UK been minimal since the 1990s. That was the time before government started to force people into PAYE in order to maximise National Insurance revenue.
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