The Conservatives are urging the government to rule out tax rises at the Budget, which Chancellor John Healey is due to deliver on 28 October. Shadow chancellor Andrew Griffith said businesses and self-employed workers were facing too much uncertainty and argued that further taxation could damage investment and growth.
In his first major speech since being appointed to the role by Conservative leader Kemi Badenoch, Griffith said taxes had reached “nosebleed territory”. He called on Healey to reject increases affecting small businesses and the self-employed, saying businesses were “suffering enough”. He also claimed that rumours of higher taxes were “causing Britain’s wealth creators to flee the country”.
Griffith proposed replacing the IR35 rules governing contractors. He said the system had “crushed the dreams” of self-employed people and promised a framework that would allow workers to choose their status while preventing abuse. The rules are intended to stop people avoiding employment taxes by presenting themselves as self-employed contractors, although some freelancers say they have been treated unfairly.
He also called for a pause to the rollout of Making Tax Digital for self-employed workers. Griffith acknowledged that the previous Conservative government had introduced the system, but said its implementation had fallen short despite good intentions. He said he had commissioned Lord Mackinlay of Richborough and Robert Colvile to prepare a report on reducing regulation for small businesses.
Labour responded that Griffith had made Conservative priorities clear by proposing to scrap workers’ rights while offering tax cuts without explaining how they would be financed or which public services might face reductions. A Labour spokesperson also said the Conservatives should apologise for the economic disruption associated with Griffith’s former boss, Liz Truss, rather than asking working people to bear the cost again.
The Budget will be delivered amid rising inflation and global energy prices. Trade unions are due to meet Healey before then, with Unite pressing the government to reverse the freeze on tax thresholds. Burnham has described the Budget as “challenging” because of the war in the Middle East, while saying he is prepared to make difficult economic decisions.