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What does the snap general election mean?

What does the snap general election mean?

Despite claiming she wouldn’t do so, Theresa May has this week called for a snap general election. Politicians hey!

The election has now been given the green light following a vote by MPs, and will take place on 8 June – not so very far away.

It’s fair to say the last 12 months or so politically have been, well, where to begin exactly.

Regardless of what’s gone on over the other side of the Atlantic, in the UK, Brexit is fundamentally at the top of the agenda.

May has faced a tricky time getting her Brexit deal through, and the window for a general election was somewhat finite due to the negotiations around Brexit set to commence in earnest following the German Federal Elections in September.

But what does this snap general election mean for contractors?

Simon McVicker, Director of Policy at The Association of Independent Professionals and the Self Employed (IPSE), has given his thoughts.

“If as looks likely, and the country gives Mrs May her mandate, what can we expect, other than a hard Brexit?” he said. “Firstly, the Conservative pledge to not raise income tax or NICs during this Parliament will have gone. That, therefore, will be very much on the agenda again. Will the Chancellor use his autumn Budget to try and raise NICs on the self-employed again? The fiscal position will not have changed just because there is a General Election.”

McVicker also believes that the Taylor Review, which has been commissioned by the government and will look at modern taxation and employment in the UK, will be delayed. He doesn’t fear it being cancelled in its entirety however.

“Matthew Taylor’s recommendations may have a stronger sway with a newly re-elected Government,” he says. “So, the definition of what exactly self-employment is, will still be firmly on the agenda. As will what right’s the Government provides the self-employed, if any?”

The general election may also have an effect on IR35.

“With a new mandate, will the Government be emboldened to roll out the recent public sector changes in the private sector too?” asks McVicker. “Will the Dividend Tax be adjusted?”

The IPSE is to publish its manifesto for the next government in a few weeks time, and will cover a range of points. Among these will be the association’s Freelance Limited Company tax proposal.

“Over the summer we intend to carry out work around pensions and later life saving, and we will also work with a leading think tank to produce a report looking at the creation of a tax system for a more flexible world of work and business,” explains McVicker. “This will be ready in time for the autumn Budget.”

Self-employment and personal service companies have been very much to the fore in the political space in recent times, and McVicker says that will remain the case regardless who wins the 2017 general election.

“Undoubtedly we will have a few battles in the next Parliament but IPSE is now an established voice in the halls of Westminster and our advice is sought by both Government and Business,” he added.