The time between the announcement of a general election and election day is often fraught with uncertainty, which leads to many businesses holding off on making significant plans or investments. Prospective changes to policy can cause SME’s to act with caution and ponder over the future of their business. But what types of policy changes can small businesses expect from the government elected on July 4th, how could they impact your business proceedings, and how can you implement measures to boost small business growth in the meantime? We’ve covered the ways the upcoming election could impact technology, tax, investment, compliance and the economy, and some of the main partys’ pledges that could impact small businesses should they come to power…
Potential Policy Changes That Impact Small Business Growth
Technology
Investing in digital infrastructure and technology can significantly boost small businesses. Policies promoting better broadband access, supporting digital skills training, or funding tech innovation can help you remain competitive. This is something that the Liberal Democrats are rather keen on, with their manifesto pledging that they will “develop an industrial strategy that will give businesses certainty and incentivise them to invest in new technologies”.
Tax
A primary concern for small businesses is how elections could reshape the tax landscape. Different parties propose various approaches to corporate tax rates, VAT, personal tax, and business rates. Proposed tax cuts or increases can greatly impact your bottom line, so monitoring party manifestos and their tax plans will help you anticipate changes and strategise accordingly. For example, the Conservative Party have pledged not to increase corporation tax and have vowed to abolish the main rate of national insurance, which will directly impact small businesses across the UK. The Labour Party have also made pledges to help SME’s, vowing to abolish business rates and instead “replace it with a fully costed and fully funded system of business property taxation”.
Investment
Government support through grants, loans, and other financial aid is crucial for many small businesses. Election promises often include new funding opportunities or changes to existing schemes: whether it’s more accessible grants for startups or improved loan conditions for SMEs, these changes can provide vital financial support. A good example of this comes from the Conservative party who have pledged to support small businesses “with a business rates support package worth £4.3 billion over the next five years” as a means of investing in opportunities for SME’s.
Fiscal Strategy
The incoming government’s overall economic strategy will significantly influence the business environment. Policies aimed at boosting economic growth, controlling inflation, or managing public spending will affect consumer spending power and business costs. For example, the Labour Party are hoping to provide a ‘genuine living wage’ for workers, ban zero hours contracts and end ‘fire and rehire’, which will undoubtedly impact businesses across the UK should the party get a parliamentary majority. Understanding these broader economic policies will help you make informed decisions about pricing, investment, and expansion.
Compliance
Changes to compliance and regulations can significantly impact small businesses. Alterations to employment law, health and safety regulations, and industry-specific rules could be forthcoming, and there may be shifts in policies regarding employee rights and benefits, affecting your hiring practices and operational costs. The Conservative party, in their continued post-Brexit regulatory reform, have stated in their 2024 manifesto that they wish to ‘transform the UK regulatory landscape… with proportionate protections for consumers and working people’, suggesting that there will be upcoming changes to business regulations. Labour aim to make regulatory changes too, stating that they would remove the barriers to exporting, create a small Business Export Taskforce, and thereby giving British SME’s a broader reach.
Accelerate Small Business Growth With A Virtual Office
With the general election on the horizon, many growing businesses and start-ups are anticipating change. Some businesses may even be looking to reduce their overheads and save money in anticipation of the election and the alterations it could bring. But how can you reduce your overheads and grow your business whilst keeping your team functioning at its very best?
A simple change you can make to grow your business is to utilise virtual office services to cut their costs. A virtual office is an address that can be used for business correspondence, allowing you to have a reputable business address and strong online presence without hiring out a physical office space. This is a fantastic option for SME’s looking to save money without hampering their reputation – you can keep your esteemable office address without having to pay for the rent and upkeep of a physical office space.
Many virtual office service providers – Grosvenor House included – also provide other cost-saving features. From call-handling and mail forwarding services which fill in as your personal secretary, to meeting room hire for important events and meetings, a good virtual office provider should give you the tools you need accelerate small business growth whilst saving on costs. So, if you’re looking for a way to keep your overheads low in the run-up to the election, get in touch with the Grosvenor House team below to find your ideal virtual office package today!