Financial and business services respond to election results

Following the announcement of a majority Conservative government, various financial and business services in the UK have given their response. 

Chris Sanger, EY’s head of tax policy, commented on what the General Election result means for UK tax and the Chancellor’s Budget in the new year. 

Financial and business services respond to election results

Chris Sanger, EY's head of tax policy

He said: “As the UK woke up to the news that the Conservatives have a significant parliamentary majority, many will now be starting to ask what the proposed tax changes outlined in the party’s manifesto and in comments made during the election campaign might mean in practice.

“While there is an element of ‘business as usual’ from a tax perspective, the election campaign did signal a shift in emphasis, not least with the cancellation of the scheduled cut in next years’ corporation tax rate and the references to reforming entrepreneurs’ relief and limiting arbitrary tax advantages for the wealthiest in society. Beyond this, progress on Brexit may also produce issues to be resolved for the new world after we leave the EU. The scale of the Conservatives’ victory not only gives momentum to the Brexit process, but leaves the Government with some flexibility over the detail of the negotiations on the desired Free Trade Agreement.

“The manifesto set out some of the Conservative’s thinking, and the promised Budget in February will give taxpayers the opportunity to see the finer details of the proposed changes sooner rather than later.

“In fact, the tax content of the manifesto had much of the flavour of a Budget, so it is relatively easy to predict how these promises translate into Budget measures. The real question will be whether the Government, empowered by its significant parliamentary majority, chooses to supplement these manifesto commitments with new, bolder policies.

“Budget confirmation of the increase in allowances supporting investment – such as the increase in the rate of structures and buildings allowance – will be welcome.  At the same time, the removal of the risk of the introduction of the ‘Inclusive Ownership Fund’ concept ends concerns that this policy had created for the use of UK as a headquarter location.  Businesses can now start to engage with the Government ahead of the February Budget.”

Dr Liz Cameron OBE, director & chief executive, Scottish Chambers of Commerce, said: “The Scottish Chambers of Commerce extends our congratulations to the Conservative Party for winning the election. Now the campaigning is done, the real work of government must begin and accelerate.

Financial and business services respond to election results

Dr Liz Cameron OBE

“For too long the needs of businesses and the economy have been left on the back burner while parliamentarians have served up a hot mess. The lack of uncertainty over Brexit has caused untold damage to the economy because it has discouraged businesses from investing. Political focus has been on parliamentary mathematics, not on the business of supporting the economy and employers.

“Now we have a government and, perhaps, a plan, we need them to get down to the basics of economic support creating an environment which is fit for business. We expect the focus to be heightened on infrastructure investment and the development of our talent. We also need quick answers to international trading arrangements and an immigration policy that is fit for the needs of Scotland and its employers.

“Our Scottish representatives at Westminster need to put the economy of Scotland at the forefront of their minds and in all policy discussions; that means supporting job creation and enabling Scotland to remain ahead of the game in global competitiveness. For those who have been elected or re-elected, they would do a complete injustice to the people who have voted them in if they do not ensure they use their voice and votes wisely.

“Now more than ever we need our leaders at Holyrood and Westminster, to get behind the needs of the economy to ensure that Scotland remains prosperous for all.”

The Federation of Small Businesses (FSB) in Scotland said that the new UK Government must deliver a Brexit-deal with a transition period long enough for small businesses to prepare for a change in trading conditions.

Financial and business services respond to election results

Andrew McRae, FSB’s Scotland policy chair

In addition, the small business campaign group has urged all MPs to make the case for an immigration system which meets Scotland’s needs and for funding to support local towns north of the border.

Andrew McRae, FSB’s Scotland policy chair, said: “Scotland’s business community will hope that this General Election has rebooted the UK’s political system. Now we need to see our new elected representatives deliver a Brexit process that doesn’t buckle the real economy while taking action on long-neglected domestic policy issues, like the UK’s late payment crisis.

“We need to see a Brexit process with a built-in preparatory period. And all of Scotland’s elected representatives need to press for an immigration system that delivers for our local economies and communities.

“During this election, candidates have been pounding the streets of our local towns up and down the country. Our new and returning MPs need to remember these important local places and ensure that they get their fair share of UK Government towns funding.”

Personal Investment Management & Financial Advice Association (PIMFA), the UK’s trade body for the personal investment services and financial advice profession has urged the new government to show that it has designs beyond Brexit.

PIMFA is today asking for policymakers to work together in order to build a culture of saving and investment across the UK for the long term and to:

  • Put in place a framework of smarter regulation to enable an increase in trust in the sector
  • Commit to a financial capability and engagement framework for the UK’s savers
  • Work with all employers to roll out financial check-ups undertaken by a regulated financial adviser

Commenting on the election result, Liz Field, chief executive of PMFA, said: “We are committed to building a culture of saving and investment across the UK and this starts with ensuring that policymakers are able to create an environment where ordinary retail savers can thrive. We look forward to working with the new government in moving towards this goal.

Financial and business services respond to election results

Liz Field, chief executive of PMFA

“As representatives of a community of wealth creators in the UK, we look forward to engaging constructively with the next government whatever its colour or composition. When Parliament returns we will do our utmost to ensure that this community is at the heart of any plans which go towards building a culture of saving and investment.”

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