A snap poll carried out by the Institute of Directors (IoD) has found that, following the General Election and the subsequent Hung Parliament, business confidence in the UK economy has ‘fallen dramatically’.
The poll of 700 IoD members revealed that businesses require ‘rapid agreement’ on transitional arrangements that arise from Brexit talks, alongside clarity as to whether EU nationals already residing in the UK will be permitted to remain in the country following Brexit.
Businesses also have ‘no desire’ for another election this year, the poll suggested.
The IoD has called for the government’s main priority to be striking a new trade deal with the EU.
It also warned that political uncertainty generated by the election could have ‘disastrous’ consequences for the UK economy.
Stephen Martin, Director General of the IoD, said: ‘The needs of business and the discussion of the economy were largely absent from the [General Election] campaign, but this crash in confidence shows how urgently that must change in the new government.’
Business groups have expressed their opinions on the forthcoming Brexit negotiations and trade talks in the wake of Prime Minister Theresa May’s signing of the letter that triggers Article 50.
A press release from the Confederation of British Industry (CBI) said: ‘Businesses across Britain are 100% committed to making a success of Brexit – and getting off to a good start in the negotiations will be vital in getting the best deal.’
The British Chambers of Commerce (BCC) suggested that UK businesses would like exit and trade talks to take place simultaneously. Adam Marshall, its Director General, commented: ‘Concluding exit and trade negotiations at the same time would moderate adjustment costs for UK businesses and enable trade between UK and EU firms to continue with less disruption.’
The Federation of Small Businesses (FSB) called for the government to secure ‘the easiest possible access to the single market’. Mike Cherry, National Chairman of the FSB, said: ‘Now that Article 50 has been triggered, it is time for the government to work towards a pro-business Brexit and give small firms some clarity on how leaving the EU will impact their businesses.
‘The government must push for a comprehensive free trade agreement with the EU based on ease and cost, and then support small firms to take advantage of new trade agreements with priority markets around the world.’
Meanwhile, Stephen Martin, Director General of the Institute of Directors (IoD), said: ‘Now the real work begins. Ministers must roll up their sleeves and focus on getting a good deal for Britain in the tough negotiations ahead. Success means listening to business on the vital priorities of maintaining tariff-free trade, minimising customs red tape and keeping the bureaucratic hurdles to bringing in necessary skills as low as possible.’
The Institute of Directors (IoD) has claimed that the tax system is not keeping up with the growth of self-employment and the digital economy, and has called for Chancellor Philip Hammond to create a new Tax Commission when he presents his Budget on 8 March.
In its Budget submission, the IoD argues that a new Commission should investigate how the tax applied to the self-employed could be brought in line with employees, and how online stores could be taxed fairly in relation to high street shops.
Stephen Martin, Director General of the IoD, said: ‘In the short-term, the government must take action to relieve some of the pressure on the small businesses facing hikes in business rates, and encourage companies to bring forward productivity-boosting investment.
‘But we should also look to the future, launching a new Tax Commission to look at what the growth of self-employment and online business means for the tax system. The goal must be a much more level playing field, which treats both high street and online businesses fairly, and adapts to the growth of the ‘platform economy’, which is leading to an increase in flexible work.’
The IoD has also called on the Chancellor to:
- grant further reliefs from business rates for small businesses occupying properties worth up to £100,000
- increase the Annual Investment Allowance (AIA) cap to £1 million
- reiterate the manifesto pledge for the UK to have the lowest corporation tax rate in the G7
- consult on creating a simpler tax system for small businesses, with a fixed rate for company owners to pay themselves, rather than the different rates of income tax, national insurance, corporation tax and dividend tax
- consult on ‘liberalising’ investment schemes for start-ups.
The Chancellor will present the 2017 Spring Budget on Wednesday 8 March. Make sure you keep an eye on our website for coverage of the key announcements.
Five of the most prominent business groups in the UK have jointly signed a letter outlining their priorities for British businesses across all sectors for 2017.
The letter, which is signed by the leaders of the Confederation of British Industry (CBI) and the Federation of Small Businesses (FSB), amongst others, outlines the business groups’ intentions to make 2017 ‘a year of progress and success’.
Additionally, it notes that the decisions that will be made during 2017 will affect prospects for individuals, businesses and communities across Britain ‘for generations to come’.
The groups, which also include the Institute of Directors (IoD), the British Chambers of Commerce (BCC) and manufacturers’ organisation EEF, have pledged to work in conjunction with businesses from ‘all corners of the UK’ in order to help them ‘seize opportunities and overcome the challenges that lie ahead’.
The declaration comes as the Prime Minister prepares to trigger Article 50 – the legal process that will mark the beginning of two years of EU exit talks. The government plans to activate Article 50 by the end of March.
06 Jun 2014
Following the Queen’s Speech, business groups throughout the country have made their comments and recommendations for the future.
The British Chambers of Commerce (BCC) director, John Longworth, said: ‘Businesses across Britain will be relieved to see that the Government has opted for a streamlined legislative programme, meaning ministers can devote more time to delivering the best possible environment for economic growth and enterprise’.
The Federation of Small Businesses (FSB) were happy to report on the first ever Small Businesses Bill set to benefit FSB members, describing it as ‘a significant piece of legislation that is, for the first time, specifically designed to address the needs of small businesses’.
FSB National Chairman, John Allan, said: ‘It included measures that we have pushed for in our discussions with Government and indeed all political parties over the last twelve months to help them support their growth ambitions – such as action on late payment terms for smaller suppliers and to beef up scrutiny of unnecessary regulation’.
Phil Orford, Chief Executive of the Forum of Private Business (FPB), said: ‘There is nothing overly ambitious for the businesses but the presence of a Small Business Bill will mean a number of smaller measures that could support enterprise. We need to await the real detail of the Bills clause by clause and will see what opportunities there are to push for even more pro-business reforms’.
Director General of the Institute of Directors (IOD), Simon Walker, also welcomed the Small Business, Enterprise and Employment Bill, ‘which will deliver necessary and overdue reforms’. Mr Walker made it clear that the task was now to translate the legislation into a clear vision for the future of both the country and Parliament.