SMEs across the UK have collectively congratulated and encouraged the new small business minister, Margot James, to prioritise innovation to boost business investment and propel start-ups.
GrowthBusiness rounds up a handful of early requests for the MP.
Special tax codes
A special, lower personal tax code for those working for start-ups and smaller SMEs may help these companies establish themselves, particularly in the areas of the country, such as the North East, that require economic stimulation.
According to small business investor and the entrepreneur behind the RU group of companies, Richard Upshall, with interest rates virtually as low as they can be, what is really required is support from Government for low interest, long-term loans to small businesses to help manage cash flow and keep investment coming in. Coupled with a drop in Corporation Tax and some other taxation changes, this would further encourage growth.
“However, Margot James could help make the BEIS Department go even further. Scrapping corporation tax completely in favour of licensing fee would massively encourage small business owners and employees to strive for higher profits, which would lead to greater contribution to the economy, knowing they get to keep, and of course spend, save or invest, the gains,” he says.
Upshall believes a licence to do business avoids capital going overseas in to tax schemes and can encourage companies to consider the UK as a ‘haven’ for business in the modern world.
“To encourage things further she should consider a new personal income tax code for those brave enough to join start-ups or the smaller SMEs, which be a risk, but suddenly creates more options and opportunities. Just imagine raising the tax threshold, or freezing personal income tax for a year or two while start-ups get going,” he explains.
“Excitement, innovation and attraction of talent could come in from all over the world. It seems like a great option as opposed to having to pay out benefits and could be especially lucrative for the longer term greater good in areas needing economic stimulation.”
Stronger support system
For Sean Mallon, CEO of business for sale marketplace Bizdaq, small business owners are feeling the pressure of running their business now more than ever before. A study by the company released today found that small business owners are working thirteen hours a week more than the UK average, and one in four are seeing the negative impact of overwork on their health.
“The fact that so many small business owners are struggling is astonishing and really shows the need for the government to do more to support the backbone of the British economy. Now more than ever, the UK needs strong small businesses,” Mallon says.
“The abolishment of Business Link and the regional adviser program by the Coalition government in 2010 left a vacuum in small enterprise in the UK. Where small business owners previously felt the benefits of having a local support network, there are currently no services where owners can turn to when looking for support. I would call upon the new small business minister Margot James to prioritise the re-establishment of business support on a local level,” he adds.
A more robust regulatory environment
James Sherwin-Smith, CEO of alternative finance platform Growth Street, believes the regulatory framework for finance providers can help widen access for SMEs to the growth capital they need.
“SMEs are responsible for the majority of private sector employment and are the growth engine of our economy. However, it is disappointing to see that the importance of small business in the new Government has effectively diminished, as the brief was previously held by a Minister of State who attended cabinet,” Sherwin-Smith says, referring to Ms James’ predecessor, Anna Soubry.
“The new minister has a crucial role representing the interests of SMEs. In particular, I would ask the minister to focus on improving the competitive and regulatory environment for the provision of financial services to businesses, particularly in light of the Competition and Markets Authority investigation that will conclude next month, and the ongoing review underway at the Financial Conduct Authority,” he adds.
Equal pay for equal work
Currently, the gender pay gap is not only a failing in equality, but it is also affecting our economic success, according to various studies on the topic highlighting that businesses with more than 10 per cent of women leaders have higher profits.
Growing businesses may have a lot to look forward to in bridging the pay gap during Ms James’ time at office.
After a period of consultation, between 12 February and 11 March 2016, it has been announced that from 2018 companies that employ over 250 people will be required to publicly report on the earnings of men and women in the workplace. Businesses will be required to publish gender pay by grade/level and bonus details on an annual basis, including how many women and men are in each pay range. During Ms James’ tenure, SMEs could be encouraged to follow suit.
What’s your business wishlist? Let us know in the comments below