A recent report from the TaxPayers’ Alliance has revealed that the tax burden (the amount of tax paid to the Treasury as a proportion of total annual income) this year is at a 49-year high, at 34% of GDP.
Responding to these figures, the Association of Independent Professionals and the Self-Employed (IPSE) have said that the government needs to reassess tax raising policies immediately – starting with putting an end to the proposal to extend last year’s IR35 reforms to the private sector.
IPSE’s Director of Policy, Simon McVicker, commented on these latest findings, “The self-employed have had more than their fair share of tax hikes under this Government. The cut to the dividend taxable allowance has meant a significant real term increase in the tax bills of many independent professionals.
“Worse still, last year’s IR35 reforms have resulted in thousands of public sector freelancers being wrongly taxed as if they were employees while receiving none of the employment rights. Now the Government wants to extend that same change to the private sector, a change that threatens to strangle the UK’s greatest competitive advantage – it’s flexible labour market. People don’t mind paying taxes if they are fair and transparent – the problem with IR35 is that it is anything but fair.
“The Government’s zeal for raising tax, as highlighted by the TaxPayers’ Alliance, seems to have taken precedence over traditional Conservative principles of driving economic growth by allowing people to keep more of the money they earn.
“Everyone understands that we need to fund our public services, but the Government is in danger of killing the goose which lays the golden egg, namely the UK’s 4.8 million self-employed who enable innovation by providing flexible expertise to businesses which are looking to grow.”
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