New Tory leader and freelancers

Conservative leader-in-waiting, Michael Howard, already has something of a track record with issues affecting freelancers.

Following a coup d'etat by Conservative MPs which unseated Iain Duncan Smith as leader of the Opposition, and an effective acceptance that former Home Secretary and Shadow Chancellor, Michael Howard, will be the only candidate to come forward for the leadership, his position is virtually assured in an attempt to reunite a Party which has been beset by internal wranglings for nearly a decade.

IR35

In the aftermath of the introduction of IR35, the Conservative Party pledged to repeal IR35 if they were elected and that the existing legislation would be replaced by targeted measures to deal with any abuse of 'personal service companies' for purely tax purposes.

However, following a change in leadership when Duncan Smith took over from William Hague, there were 'hints' from Conservative Front Bench spokesmen, including Michael Howard, that any previous long-standing tax commitments could be up for review. Although there was no official confirmation that this would lead to a reversal of the policy towards IR35 and, at the time, some Conservative spokesmen continued to brief that they believed their policy on IR35 was the right one.

But in practical terms and given the time period which has elapsed, it is likely that a new leadership will want to look afresh at these issues. At this level, Michael Howard has already familiarised himself with some of the problems facing freelancers.

Freelancers' seminar

In July 2003, the Conservative Front Bench Treasury team, including Mr Howard and Shadow Economic Secretary Mark Prisk MP, hosted a seminar with UKTECH for a range of freelancer groups and representatives from the creative and media world to identify areas where Conservative policy could be formulated to help freelancers.

The then Shadow Chancellor Michael Howard listened to concerns and issues specific to freelancers, including journalists, composers, songwriters, actors and 'behind-the-scenes' film and television workers, as well as issues which have been previously highlighted by other freelancer groups.

At the time, Mr Howard said: "The Conservative Party values the role of freelancers and the flexibility they bring to the economy. We are concerned that under this Government freelancers and the self employed are discriminated against and receive a rough deal on tax, NI and benefits packages, in comparison to the employed.

"Freelancers were first hit by the IR35 legislation, which has caught out many genuine self employed people and freelancers. Several years on the Government has also failed to recognise the discrimination facing freelancers in the tax and benefits regime, while they have been happy to provide changes in the corporate tax structure - changes which the self employed have been specifically excluded from. The Conservatives aim to remedy this".

Click on headline link for the UKTECH report from 9 July, 2003 Creative Freelancers get Tories' ear

Section 660 - Get your house in order

In April 2003, Michael Howard, in his role as the Shadow Chancellor wrote to his opposite number in Government, Gordon Brown, accusing him of creating chaos with Section 660 - the so-called business tax on families and friends - and leaving 1.7 million family firms in doubt over tax bills.

Commenting on updated Inland Revenue guidance on Section 660 and on a letter to the Conservative Treasury team from the Paymaster General, Dawn Primarolo, about a reported Inland Revenue crackdown on family businesses that share incomes equally between partners, the Shadow Chancellor, Michael Howard said: "The Chancellor is presiding over chaos and confusion in his revenue collecting agencies. Customs and Excise is in chaos over collapsed trials, questioned guidance and judicial review. The Inland Revenue is in chaos over the Child Tax Credit. Now the Revenue has been forced to issue 'clarified' guidance on the tax treatment of family-run businesses, creating uncertainty for hundreds of thousands of business people who could face - and in more and more cases are facing - back-dated tax bills up to tens of thousands of pounds.

"I have written to the Chancellor to ask for him to get a grip on his department. His policies have created the chaos. It's time he got his house in order."

Click on the headline link for the UKTECH report from 30 April, 2003 Chancellor accused of creating chaos with Section 660

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A lengthy - and at times heated debate - followed a recent UKTECH article Conservatives: A postcard from Blackpool which focused on some of the leadership issues facing the Conservative Party during their annual Party Conference and the possibility of a single challenger emerging to replace Mr Duncan Smith.