I smell the smell of frantic back pedalling.
Labour’s shadow chancellor says the government is in disarray after Theresa May said Budget tax rises would not go before MPs until the autumn.
John McDonnell called it a “partial U-turn” over National Insurance increases for self-employed workers.
Prime Minister Mrs May defended the change as “fair”, amid a backlash from some Tory MPs and newspapers.
But she said it would not be voted on until after proposals for extra rights for the self employed was published.
The review of modern employment practices by RSA chief executive Matthew Taylor will be published in the summer.
The prime minister told journalists on Thursday: “People will be able to look at the government paper when we produce it, showing all our changes and take a judgment in the round.
George Osborne was correct that this proposal was unsellable. Far too many of us are self-employed and it could cost the Tories the next election. This is for two reasons – firstly, despite their weasel words, it is a breach of their manifesto promise (although the Brown Gorgon proved that these aren’t worth the paper they are printed on) and despite any fiddling at the edges, the self-employed do not enjoy the same benefits as the employed. Only the ideologically blinkered will try to argue that it is otherwise.
There is a third reason – the one that remains unbroached. If there is iniquity in the system, then reduce the NIC contributions paid by those on PAYE and make swingeing cuts to public spending. I am more than happy to offer my services as a consultant on the matter (my rates are very competitive). I would save them billions at the stroke of a pen.
As it is, I’ll be reminding my Conservative MP that he cannot rely on my vote if this proposal does go ahead. That said, I’m not sure he can rely on it anyway, but he’s not to know that is he? Ahem!
In fact the NI increase is relatively minor, except for the twin PR disaster of breaking a promise and hitting exactly the important group of voters.
The nasty tax rise is the death tax created by turning the probate necessity into a tax collection, a tax which was universaly panned in prior discussions and and will hit many more ordinary people a lot harder. I don’t understand why the main outcry is about NICs.
I think this is because they made a big thing about NIC and snuck the probate tax under the radar.
And of course, it’s because it is so obvious that the self-employed do not have access to taxpayer funded benefits such as SSP and Maternity leave. Although these are ostensibly paid by the employer, the employer then deducts this when submitting accounts to the HMRC, so, in effect, claims it back. Given this glaring iniquity – we are expected to pay the same yet get less when we need it, no wonder people are up in arms.
Matthew Taylor, former Blair advisor “sacked” for being too left-wing and appointed CEO of RSA – no, not the RSA Gov’t wants you to assume (Royal & Sun Alliance insurance), but state funded Royal Society of Arts
https://www.thersa.org/discover/publications-and-articles/matthew-taylor-blog
More Gov’t mendacity – and May said she would help “JAMs” and be honest.
Meanwhile, under the radar, the self-employed shafted again: changes to small business simplified VAT scheme will result in quadrupling of VAT payments by many small businesses.
Does Trade descriptions act apply to political parties?
The Not The Conservative Party falsely claims to be The Conservative Party.
Unfortunately not.
One reason for frantic action now is the HMRC move to try to crack down on contractors and push many more into IR35. This has caused the vast majority of government contractors to cease contracting and fail to renew contracts.
This was entirely expected by everyone except HMRC and, it would seem, the Civil Service who now face many of their projects failing completely due to a lack of people to work on them. This will be being communicated directly to MPs, so we can expect movement on this facet of law as well.