On the Horizon: New Labour Policies for Your Business
With the Labour Party's victory and Keir Starmer as the new Prime Minister, small business owners are keen to understand the implications of this shift in power. Labour has outlined several policies that could impact the business landscape. Here’s what you need to be aware of:
1. Late Payment Reforms Labour plans to tackle late payments, a significant issue for small businesses. New laws will require larger companies to disclose payment practices, aiming to ensure prompt payment for services and goods.
2. Business Rates Reform Labour is set to replace the current business rates system with a new tax structure. This change aims to lower costs for small businesses and high street shops, while ensuring larger corporations pay their fair share.
3. Energy Costs Labour's flagship initiative, Great British Energy, aims to reduce energy bills through publicly owned clean power. While the long-term effects are uncertain, this initiative seeks to alleviate the financial burden on small businesses.
4. Access to Public Contracts Labour intends to make it easier for small businesses to win government contracts by mandating that at least one small business is included on shortlists for tenders.
5. Exporting Support The government will offer guidance and reduce barriers to help small businesses export their products, making it easier to tap into international markets.
6. British Business Bank and Banking Hubs Labour plans to enhance the British Business Bank’s mandate to support regional growth and establish banking hubs to ensure businesses have access to face-to-face banking services.
7. Taxation and VAT Threshold There is speculation about changes to the VAT threshold. Although Labour has not confirmed specific plans, small businesses should prepare for potential shifts that could affect their tax liabilities and administrative responsibilities.
8. National Living Wage Labour will introduce a “genuine living wage” that reflects the actual cost of living and applies to all adult workers. This could increase labour costs for small businesses, necessitating adjustments in their financial planning.
9. Employment Law Changes Labour plans to reform employment laws, including stronger union rights, ending exploitative practices, and introducing day-one rights for employees. These changes will increase regulations for employers but aim to improve worker conditions.
While Labour’s proposed changes present both challenges and opportunities, staying informed and proactive can help small business owners navigate this new political landscape. Adapting to these policies will be crucial for sustaining and growing your business.
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