Tag Archive for Rishi Sunak

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What does the latest Treasury stimulus mean for small business?

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Originally written by Timothy Adler on Small Business
Chancellor Rishi Sunak will announce the latest Treasury stimulus for small business later this afternoon, as millions of small businesses face shutdown for four months.
Yesterday, prime minister Boris Johnson advised everybody not to venture out of their homes apart from non-essential journeys such as work and food shopping – leaving millions of small businesses in limbo, faced with either having to make staff redundant and yet unable to claim on business insurance because the government, unlike as in Italy and Spain, has not made the coronavirus lockdown official.
The British Beer and Pub Association warned that “thousands of pubs and hundreds of thousands of jobs will be lost in the very short term” unless the government bails it out.
Whatever Sunak announces in his Treasury small business stimulus package will build on the £30bn spending package he announced in last Wednesday’s Budget but now seen as insubstantial given the onslaught of the crisis.
What can Rishi Sunak do?

A People’s Quantative Easing Former Goldman Sachs Asset Management chairman and government minister Jim O’Neill has called for a “People’s Quantative Easing” – basically, injecting money into people’s bank accounts.
Suspend business rates entirely This would cost the Treasury £31.5bn or

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Budget 2020 what it means for small business – analysis and live blog

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Originally written by Timothy Adler on Small Business
UPDATED: Chancellor Rishi Sunak has announced a £30bn spending package to help mitigate the impact of the coronavirus outbreak.
Government to cover statutory sick pay for SMEs
Statutory sick pay will be available to all those advised to self-isolate from the virus. The government will refund the cost of statutory sick pay for up to 14 days to small- and medium-sized businesses at a cost of £2bn. This will apply to businesses with fewer than 250 employees.
Announcing his Budget this afternoon, the chancellor acknowledged coronavirus would cause “temporary disruption” to the economy.
Jonathan Richards, CEO and founder of Breathe, added: “As a small business owner, it’s reassuring that the government will cover the strain caused by sick pay, as well as offering significant loans and cash injections to UK small businesses.
Coronavirus Business Interruption Loan Scheme
A “Coronavirus Business Interruption Loan Scheme” will support up to a further £1bn lending to smaller businesses. The government will guarantee bank loans to small businesses on amounts of up to £1.2m. The government will cover bank losses of up to 80pc.
Business rates to be scrapped for certain businesses…
Business rates will be abolished altogether for smaller firms in retail, leisure and hospitality

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Don’t scrap entrepreneurs’ relief, argue small firms

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Originally written by Timothy Adler on Small Business
Small business has asked chancellor Rishi Sunak not to renege on the Conservative election manifesto promise to reform, not scrap entrepreneurs’ relief.
The Treasury is said to want to abolish the £2.7bn tax break in the March 11 Budget in order to fund pay for nurses and police officers and for projects that could help “level up” the north and the south.
The relief allows business owners to pay a 10 per cent rate of capital gains tax when they sell their companies, compared with the usual 20 per cent. It usually applies to gains of up to £10m. Entrepreneurs’ relief was introduced in 2008 by Alistair Darling to encourage people to start or back new companies.
The cost of the relief has risen from £427m in 2008-09 to £2.7bn in 2018-19.
However, the Federation of Small Businesses, has hit back at the Sunday Times report that the chancellor will scrap, not reform, entrepreneurs’ relief. Previously, former chancellor Sajid Javid was mulling scrapping entrepreneurs’ relief for start-ups but keeping it on for existing business.
Only around 10 per cent of people who claim entrepreneurs’ relief are selling businesses worth more than £1m, says the FSB. And the vast

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Rishi Sunak blinks, says HMRC will ‘go soft’ on IR35 changes in year one

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Originally written by Timothy Adler on Small Business
Chancellor Rishi Sunak says the taxman will not be “heavy handed” when IR35 changes come into effect on 6 April, potentially bringing 230,000 sole traders within PAYE.
Answering questions in Birmingham on Saturday night, the new chancellor sought to reassure both companies and freelance contractors, saying the controversial policy will have a soft landing – at least in year one.
HMRC is keen to bring freelance contractors within PAYE in order to tackle what it calls “disguised employment”. Currently freelance contractors, one-man-band limited companies who work on projects for companies, pay corporation tax at 20 per cent instead of higher PAYE rates, while employers duck national insurance contributions. The Treasury sees both freelancers and employers as gaming the system, as effectively many freelancers are full-time employees. The IR35 reforms are projected to bring in £3bn over the next four years.
>See also: One third of freelancers say IR35 changes affecting mental health, contemplating suicide
However, the IR35 changes have triggered howls of protest, with freelancers complaining that rushed implementation has seen unprepared and panicked employers drop them. Nearly one third of freelancers say they are having mental health issues, and even contemplating suicide, because of the uncertainty.
And

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Chancellor Rishi Sunak may scrap business rates in favour of a land tax

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Originally written by Timothy Adler on Small Business
Chancellor Rishi Sunak may scrap business rates in favour of a tax based on tax values.
This land value tax would be levied on landlords, delivering a potential tax cut for hundreds of thousands of small businesses which rent premises.
However, any change could be years away, and for now the new chancellor will announce a “fundamental” business rates review in his March 11 Budget, according to The Times.
>See also: Hike corporation tax to cut business rates, urge retail bosses
A separate package of measures will be included in the budget to provide more short-term relief, the newspaper reported.
Small retail businesses complain they shoulder an unfairly high burden from business rates, which are based on shop rental values and are paid by tenants, rather than landowners.
The tax brings in about £30bn a year, making it the sixth biggest contributor to Treasury coffers, and is viewed by the government as easy to collect and hard to avoid. Rates have also become an increasingly important source of funding for local authorities.
>See also: Influential MPs call for government to rethink broken business rates
However, Ed Cooke, chief executive of retail group Revo said any change in business rates needs to

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Why Rishi Sunak is going to be good for small business

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Originally written by Timothy Adler on Small Business
Forget about the fact that you probably could not have a finer education – our new chancellor won a scholarship to Winchester College, a dauntingly intellectual public school – where he became head boy – followed by graduating with a first in politics from Oxford University and then an MBA at Stanford, probably America’s version of Cambridge. (Our dear prime minister scraped a 2:1 while at Oxford, mainly down to his laziness.)
And it’s nothing to do with him being the son of a shopkeeper pharmacist and her GP husband, who experienced the day-to-day hardscrabble of running a family business. (They had their future chancellor son do the bookkeeping.)
No, the reason why new chancellor Rishi Sunak bodes well for small business is because of a paper he wrote for free market-leaning think-tank Centre for Policy Studies three years ago.
In it, Sunak – then an ordinary MP for Richmond in Yorkshire – argued that the government should support the creation of an investment exchange for SMEs, where ordinary savers like you and me could lend money to small businesses, trading bonds like shares.
This Retail Bond Exchange would generate fresh capital for SMEs, while at the

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What small business needs from new chancellor Rishi Sunak

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Originally written by Caroline Plumb on Small Business
Very little in life surprises these days. Yesterday’s Cabinet reshuffle was a case in point. A few short weeks from the Budget and we have a new chancellor, Rishi Sunak. Really?
Rather than being shocked, instead I wondered more about what this means – in keeping with my company’s core way of thinking, “So what, now what?”.
So, does Sajid Javid’s resignation signal reforms more likely to favour businesses like mine and yours? As the news broke, the pound rose significantly with growing belief in the City a radical spending programme would ensue, less constrained by a chancellor keen to establish his fiscally prudent credentials.
It’s about time small businesses felt protected and valued by a government that has relied heavily on them and the self-employed to ensure years of austerity measures didn’t result in mass unemployment.
There are clearly areas where the Budget next month could move to allay concerns held by restaurateurs, recruiters, retailers and every other real business owner. Fail to do so and I fear the mental health, wellbeing and future financial security of business owners will be at risk.
As someone who started my first business aged 21 in 2000 with no prior

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