John Healey has pledged to devote next week’s Budget to “bloody-minded entrepreneurs”, acknowledging small and fast-growing businesses have been “under pressure” from a barrage of fresh taxes and regulation.
The Chancellor said he would clamp down on the “cost of business” as well as on the cost of living, promising to patch up relations with the UK’s private sector after it was targeted for revenue at three consecutive fiscal events. Healey conceded that the government’s overhaul of workers’ rights, as well as its multiple tax grabs, have left many firms under “a lot of pressure”.
“I want to be a Chancellor who backs businesses in Britain making a profit,” told The Times on a trip to Aberdeen to mark the approval of the Jackdaw gas field. “And those entrepreneurs who, in the end, are the ones challenging the status quo, come up with innovative ideas and are trying – some of them through sheer bloody-mindedness, to keep going through these sorts of pressures.”
Healey, who took many in the business and financial community off-guard when he was made Chancellor by Prime Minister Andy Burnham, signalled plans to reduce smaller firms’ reporting burden as part of the drive. His Treasury operation has also already ruled out any hike in capital gains tax, fearing its chilling impact on investment in the UK.
Rumours had abound that the government may look to significantly increase the tax on asset appreciation, after several key members of the Burnham administration voiced their support.
Cabinet office minister Louise Haigh has been an outspoken proponent of equalising its rates with income tax, while defence secretary Wes Streeting has cheered it as a “wealth tax that works”.
But Healey has refused to rubber stamp advanced plans for an investment visa, in a move that could starve businesses and entrepeneurs of investor cash, according to reports. The migration status, aimed at luring super-rich foreigners to the UK, would allow people instant right to stay Britain if they invest £5m in the UK economy in five years.
The Chancellor said previous decisions to squeeze businesses with consecutive hikes to employer national insurance and business rates were necessary to patch up the Conservatives’ economic “dereliction of duty”. But he conceded they had left firms facing difficulties.
“If you talk to any of the businesses that have come in and have either had one-to-ones or round tables with me, I have recognised that in recent times there’s been a lot of pressure: employment law, regulation, tax, input costs, supply chains,” he said. “And so when I talk about the cost of business, and recognising that in the same way as we’re recognising the cost of living pressures, I’m conscious of that as I go into the budget for both businesses and households.”