Labour's Small Business Agenda: A Comprehensive GuideTable of ContentsIntroductionSmall Business Exports & BREXITDigital Services TaxReforming Business RatesHigh Street PoliciesTackling Late PaymentsInitiatives for Start-up & Scale upSME Representation on Public ContractsEnergy InitiativesAddressing Skills ShortagesBuilding PoliciesConclusionFAQIntroductionAs the Labour party takes the reins of the UK government, the focus now shifts to their policies and plans for small businesses. With sweeping reforms on the horizon, Labour aims to transform the business landscape with targeted measures that promise to benefit small enterprises. Whether you’re a shop owner, a tech startup founder, or an individual planning to open a new business, understanding these changes is crucial. This guide walks you through Labour's key policies and how they could impact your business operations and growth prospects.Small Business Exports & BREXITLabour's agenda emphasizes supporting small businesses in navigating the post-Brexit landscape. Their collaboration with the Federation of Small Business on a Small Business Export Taskforce aims to dismantle barriers to exporting, simplifying the process for firms of all sizes. Improving the Trade and Cooperation AgreementWhile the UK remains outside the customs union, Labour plans to revise the existing Trade and Cooperation Agreement. Scheduled for renewal in 2025, these improvements aim to create more favorable conditions for small business exports. The objective is to reduce bureaucratic hurdles and enhance export guidance, making it easier for small businesses to compete in international markets.Digital Services TaxLabour has taken a pragmatic stance by rejecting the Liberal Democrats' proposal to hike the Digital Services Tax from 2% to 6%. This is a relief for small businesses reliant on major platforms like Amazon, which often pass increased costs onto smaller retailers. By maintaining this tax at its current level, Labour intends to foster a more balanced and less burdensome economic environment for e-commerce businesses.Reforming Business RatesOne of Labour's landmark plans is to overhaul the existing business rates system. The new business property taxation system aims to modernize the taxation landscape, reducing the financial burden on high street establishments and supporting small businesses in their expansion efforts.Impact on High Street and Online BusinessesThis reform is designed to breathe new life into high streets by making it more affordable for small businesses to set up physical stores. However, for online-only businesses, there is uncertainty about potential tax implications. It remains to be seen whether these changes will result in a tax increase for e-commerce businesses that do not operate brick-and-mortar stores.High Street PoliciesLabour's strategy for revitalizing high streets includes measures to combat anti-social behavior and revamp empty shops. By introducing new town center police patrols and appointing a mandatory antisocial behavior police lead in every local neighborhood, Labour seeks to create a safer environment for shop owners.Revamping Empty ShopsTo counter the proliferation of vacant high street premises, Labour plans to empower councils to take over empty shops and reopen them. These properties will be leased to local small businesses at discounted rates, with rental income funneled back to the owners. This initiative aims to invigorate local economies and encourage entrepreneurship by reducing entry barriers for small businesses.Tackling Late PaymentsOne of the persistent challenges small businesses face is the issue of delayed payments from larger firms. Labour plans to legislate the audit committees of big businesses to report their payment practices in their annual reports. This measure intends to foster transparency and encourage timely payments, thereby improving the cash flow for small businesses.Initiatives for Start-up & Scale upLabour's policies aim to boost the growth and success of small startups. By unlocking the supply of patient capital for technology-intensive startups, Labour hopes to create favorable conditions for innovation and growth. Reforming the British Business BankLabour plans to revise the British Business Bank's mandate, empowering it to better support small and medium enterprises (SMEs). This includes fostering regional growth and ensuring that institutional investors and venture capitalists are well-positioned to invest alongside the bank, thereby bolstering the startup ecosystem.SME Representation on Public ContractsEnsuring fair competition in public contract bids is another cornerstone of Labour's small business agenda. Through their National Procurement Plan, Labour aims to guarantee that at least one SME is shortlisted for every suitable contract put out to tender. This move strives to democratize access to public contracts, allowing smaller businesses to compete on a level playing field.Energy InitiativesLabour's mission to transform the UK into a clean energy superpower encompasses benefits for small businesses as well. By focusing on achieving a zero-carbon electricity system by 2030, Labour aims to lower energy bills for small businesses and create commercial opportunities within the green energy supply chain.Supporting Small ManufacturersLabour's plans involve eliminating the competitive disadvantage that UK manufacturers face due to high energy costs when compared to European firms. Although these initiatives primarily target manufacturing sectors, the long-term goal is to reduce operational costs and bolster the overall competitiveness of small businesses.Addressing Skills ShortagesLabour's strategy to meet future skills needs includes establishing Skills England, an agency dedicated to bridging the skills gap. By revamping the current Apprenticeship Levy into a more flexible Growth and Skills Levy, Labour aims to enhance businesses' ability to match their workforce development with market demands.Promoting Apprenticeships and TrainingLabour's commitment includes continuing to cover 95% of apprenticeship costs for non-levy paying small businesses. This policy ensures that smaller enterprises can still benefit from participating in upskilling their staff without incurring prohibitive costs.Building PoliciesLabour’s building policies include a bold plan to construct 1.5 million homes over their term in office, potentially creating business opportunities for small builders and tradespeople.Expanding Planning CapacityTo expedite residential and commercial development, Labour plans to hire over 300 new planners across the public sector. This influx of planners aims to streamline the decision-making process, thereby accelerating project start times and contributing to economic growth.ConclusionLabour's small business agenda comprises a comprehensive array of policies designed to support various facets of the business ecosystem. From simplifying exports and reforming tax systems to enhancing public sector contract opportunities and addressing skills shortages, Labour's initiatives signal a proactive stance towards fostering a vibrant small business community. While some policies bring clear advantages, others might pose challenges, particularly for online-only enterprises. Staying informed and prepared for these changes is essential for any small business aiming to thrive in this evolving landscape.FAQWhat is Labour's aim with the Small Business Export Taskforce?Labour intends to work alongside the Federation of Small Business to remove barriers and provide better export guidance, making it easier for small businesses to export efficiently.How will the new business property taxation system affect small businesses?The new system aims to reduce the financial burden on high street businesses, although the full impact on e-commerce businesses remains to be determined.What are Labour's plans to revamp empty shops?Labour plans to empower councils to take control of vacant shops, refurbish them, and lease them to small local businesses at discounted rates, revitalizing high streets.How does Labour intend to tackle late payments to small businesses?Legislation will require large businesses to disclose their payment practices in annual reports, increasing transparency and encouraging prompt payments.What opportunities will Labour's National Procurement Plan create for SMEs?Labour's plan aims to ensure that at least one SME is shortlisted for every public contract bid, allowing fairer access to public sector opportunities.By staying informed and adapting strategically, small businesses can position themselves to benefit from Labour’s ambitious reforms.