Hei from Slush!

I'm briefly in Finland at Helsinki's founder-focused event to speak at three events on our recent reports: Job Creators, Future Founders, and Here and Now. As a general rule, I don't attend conferences – not least, because we put on so many events of our own – but with great speakers like Sequoia Capital's Michael Moritz, Stripe's John Collison and Clearbanc's Michele Romanow, this one is making me think I should attend more. If you have any that you think are particularly worthwhile for busy entrepreneurs, let me know so I can share them in advance with our 10,000+ members.

The State of European Tech Report 2019 was launched at the event. The headline finding is positive, the number of industries receiving significant capital is increasing, but there is certainly room for improvement. One fun fact stuck out: based on Meetup data, Milton Keynes is one of the fastest growing tech hubs across the continent. From concrete cows to concrete businesses.

Labour the point
Political parties are busy making their policy positions more concrete. Labour and the Lib Dems have released their manifestos.

Labour's is radical. By its own calculations, it would push up day-to-day spending by £80 billion in 2023–24. To pay for this, the tax burden would be well above levels sustained in the UK since the Second World War. As usual, the IFS has produced the leading economic analysis.

The independent IFS has a robust take on Corbyn's plan to increase corporation tax from 19% to 26% (this would take corporate taxes in the UK to the highest in the G7 and almost the highest in the whole OECD):

"The truth is of course that in the end corporation tax is paid by workers, customers or shareholders so would affect many in the population. In the end, it is unlikely that one could raise the sums suggested by Labour from the tax policies they set out. If you want to transform the scale and scope of the state then you need to be clear that the tax increases required to do that will need to be widely shared rather than pretending that everything can be paid for by companies and the rich.”

Entrepreneurs would also be impacted by the end of Entrepreneurs' Relief; the new treatment of dividend and capital gains income, which would be treated as other income (ie. 40%, 45% or 50%); and the minimum wage increase from £8.21 to £10. While for larger companies, 10% of shares in all UK companies with more than 250 employees would be owned by employees through inclusive ownership funds.

I should point out, John McDonnell disagrees with the IFS analysis, insisting that 95% of people would pay no more tax than they do now. And Labour would give EU nationals the right to remain, which while logistically challenging would be welcomed by many entrepreneurs and their staff. They also have some good stuff around the apprenticeship levy – making it easier for employers to spend the levy by allowing it to be used for a wider range of accredited training. This is something we suggested in our Management Matters report that we produced as part our Business Stay-Up campaign with ABE.

Land liberalisation
You can read what the IFS thinks about the Liberal Democrat's manifesto here. It's not as dramatic as Labour's manifesto, but it still gets quite a lot of criticism. But ultimately, their promise to remain in the EU is probably the marmite policy that will trump all others for entrepreneurs (though don't forget that Labour is promising a second referendum on Brexit).

I want to pick on a policy recommendation in the Lib Dem manifesto that mimics something recommended in our APPG for Entrepreneurship Tax Report (and elsewhere). On page 11 of our report, we suggest the Government transforms business rates into a business land tax levied on landowners. We called for the Government to reform Business Rates to reduce administrative burdens and cash-flow issues by levying the tax on commercial property owners and not occupying businesses. And in order to incentivise investment, we suggested it should be assessed on rateable values upon the underlying land value of a commercial site rather than on the value of the property itself.

This might sound like niche stuff, but it's important. It's the smart way to fix business rates and is pretty much what the Lib Dems have in their manifesto. Labour and the Conservatives are also reviewing the plan. This is pleasing and why think tanks matter.

The Conservative Party hadn't released its manifesto yet at the time this was written. To read the full e-bulletin click here, and don’t ever miss one in the future by signing up here.