Farage’s return heats up competition for Conservatives

We look at the latest news related to Reform UK’s growing popularity with voters as the party goes neck and neck with the Conservatives in the YouGov polls. Plus we look at what Reform UK business policies could mean for freelancers and small company business owners

Donations are coming in

Reform UK has experienced a remarkable surge in fundraising this week, accumulating £1.5 million in the days following Nigel Farage’s return as party leader and his announcement to run for MP. The financial boost comes as the party sees a revival in its political prospects, significantly narrowing the gap with the Conservative Party.

The substantial funds were gathered from a mix of thousands of new members and notable contributions from larger donors. One of the most significant donations reportedly came from singer and actor Holly Valance Candy, who provided a “substantial cheque” to support the party’s efforts. Candy, a known supporter of Reform UK, is married to property developer and Conservative Pary donor Nick Candy, adding further prominence to the donation.

A recent YouGov poll highlights the changing political landscape, placing Reform UK just one point behind the Conservatives, who have seen their support dip to 18%. This shift underscores the growing influence of Reform UK on the right side of the political spectrum, posing a considerable threat to the Conservatives’ traditional base. It also mirrors similar trends in voter trends in Europe where we have seen similar gains in far-right policies in France and Germany.

Farage’s return appears to have reinvigorated the party, galvanising supporters and attracting new members at a critical juncture. With the infusion of funds and rising poll numbers, Reform UK is poised to make a significant impact in the upcoming elections, challenging the status quo and potentially reshaping the political dynamics in the UK.

Reform UK unveils radical business tax cuts

Reform UK has recently introduced a bold set of business tax policies designed to attract voters disillusioned with the current Conservative government. The party’s former leader and now chairman Richard Tice, the party is promising some of the most dramatic tax reforms seen in decades, aiming to invigorate the British economy and support small and medium-sized enterprises (SMEs)​, according to a report by The Independent and the party’s own manifesto or contract.

Key proposals include raising the income tax threshold for the higher 40p rate from £50,000 to £70,000 and increasing the basic rate threshold from £12,570 to £20,000. These changes are part of a broader strategy to alleviate the tax burden on individuals and businesses. Additionally, Reform UK plans to abolish corporation tax for over 1.2 million SMEs, increase the VAT threshold to £120,000, and cut the main corporation tax rate from 25% to 20%, with a further reduction to 15% projected within five years, according to the Reform Party manifesto.

The party also aims to abolish business rates for high street-based SMEs, offsetting this with a new 4% online delivery tax targeting large multinational enterprises. This move is intended to create a more level playing field for local businesses struggling against online giants..

Economic analysts have offered mixed reactions to these proposals. While some argue that the tax cuts could stimulate economic growth and make the UK a more attractive destination for business investment, others caution that the aggressive reductions may lead to significant revenue shortfalls. Critics also warn that these policies could disproportionately benefit wealthier individuals and larger businesses, potentially exacerbating economic inequality, it has been reported by The Independent.

Reform UK’s manifesto, which also includes controversial measures such as abolishing inheritance tax for estates under £2 million and eliminating IR35 rules for sole traders, has stirred significant debate. The party contends that these reforms will unleash entrepreneurial potential and drive substantial economic growth, a claim met with scepticism by some economic experts who question the feasibility of the proposed cuts offsetting the potential loss in government revenue.

As the general election approaches, these policies are expected to be a focal point in the political discourse, particularly among voters dissatisfied with the current administration’s handling of the economy. Whether Reform UK’s ambitious tax reforms will resonate with the broader electorate remains to be seen, but they undeniably add a provocative element to the upcoming election debates.

The latest manifestos from Reform UK, the Liberal Democrats, the Conservatives, and Labour present varied approaches to tax policies affecting the self-employed. Here’s a comparative overview based on their proposals:

Liberal Democrats

The Liberal Democrats have a multifaceted approach to taxation for the self-employed. They plan to review the controversial IR35 reforms, which have significantly impacted contractors, promising to consider more flexible arrangements. They also propose replacing business rates with a Commercial Landowner Levy to shift the tax burden from tenants to landowners. Moreover, the party aims to make taxes fairer by aligning income from wealth more closely with income from work, and by increasing corporation tax to 20% to ensure businesses contribute fairly to public finances. Read our report on the Lib Dem manifesto here.

Conservatives

The Conservative Party’s approach focuses on maintaining the status quo with incremental changes. Their manifesto does not address IR35 reform directly, indicating a continuation of current policies. However, they propose modest tax reductions for businesses, including a plan to freeze business rates for small businesses. The Conservatives emphasize stability and predictability in the tax regime to foster a conducive environment for business growth and investment.

Labour

Labour’s manifesto outlines significant changes aimed at increasing tax revenues from higher earners and large corporations. They propose to raise corporation tax to 26% and implement stricter measures to combat tax avoidance. For the self-employed, Labour suggests a more equitable tax system, with increased support for small businesses and freelancers through enhanced public services and infrastructure investments. Their approach also includes revising IR35 rules to provide more clarity and fairness for contractors.