Business Bosses vs. Parliament: The Tax Tug‑of‑War
Price Bailey’s latest study has pulled two very different tax wishlists—one from the boardroom, the other from the Parliament floor—into sharp focus. While the government’s Autumn Statement recently bumped up several taxes, the real debate now is: Which ones matter most?
How the Study Was Done
- 101 MPs surveyed by YouGov.
- 700+ business owners and senior executives interviewed.
- Respondents asked to pick up to three taxes for reform.
Business Leaders’ Top Picks
- Taxes on business sales (Capital Gains Tax & Business Asset Disposal Relief).
- Employment taxes (National Insurance Contributions).
- Corporation Tax.
Interestingly, just 32 % of MPs saw sales taxes as a priority, whereas 53 % of business leaders did.
MPs’ Priorities
- Business rates (the day‑to‑day property tax that hits high‑street retailers hard).
- Taxes on business sales.
- Profit‑distribution taxes (dividend taxes).
Why the Gap Exists
Chand Chudasama, Partner in Price Bailey’s Strategic Corporate Finance team, points out:
“Politicians think businesses fret over daily trading taxes, but the reality is the big one‑off events—like selling a company—clamp hard on capital gains. Dismissing this would hurt business confidence more than MPs realise.”
“Even with higher employer National Insurance rates, the concern over sales taxes remains, especially since they’re a small but potent drag on new business formation.”
“Only a small fraction—just over a third—cater that dividend taxes are problematic. If you can cheer up on the capital side, most owners are happy to take a haircut on dividends.”
“MPs’ focus on business rates stems from their perceived unfairness, especially on brick‑and‑mortar shops. Yet, they make up only 14 % of the UK business tax burden, so it’s a relatively minor concern.”
Government’s Tightrope
The government, locked in its pledge not to raise taxes on “working people” and the perception that Capital Gains Tax is a high‑end tax, has had little choice but to bump up employment and business‑sales taxes. This research shows that the moves most likely to dent business confidence were exactly the ones the business world finds most troublesome.
Takeaway
When it comes to tax reform, the boardroom and Parliament speak different languages. For genuine policy traction, lawmakers must read both sides—and perhaps a bit of humor—before raising the next tax.
