Rachel Reeves at the Labour Party Conference in Brighton said the party would invest £28m in green industry, freeze business rates while also offering a cut for small firms, paid for by hiking digital taxes on international companies.
She also promised a “laser focus” on efficiency in the tax system and would claw back taxpayers’ money in failed and undue Covid-19 outsourcing contracts.
She said: "I want taxes to be fair, efficient and I want them to support our high street businesses. But at the moment the tax system is stacked against high street businesses and small businesses – they are paying more than their fair share of tax while some businesses are paying less than their fair share.”
Responding to the Shadow Chancellor’s speech, as new Federation of Small Businesses research indicates that 200,000 small firms would be removed from the business rates system if its reforms to business rates were taken forward by Labour as pledged, FSB national chairman Mike Cherry said: “A successful everyday economy needs successful everyday entrepreneurs – start-ups, micro businesses and sole traders taking forward new ideas as the commercial landscape changes.
"Currently, our business owners are up against it like never before. From spiralling costs, to trade disruption, to a worsening late payment culture, to chronic skills shortages, to emergency debt repayments, our everyday entrepreneurs are in urgent need of help.
“A lot of small firms will cheer the pro-business policies set out in this speech as they fear a hike in the anti-growth jobs tax in April.
“Our research shows that the English regions that will most benefit from this reform would be the major political and levelling up battlegrounds of the North East, North West, Yorkshire, and South West.”
Shevaun Haviland, director general at the British Chambers of Commerce, welcomed green investment and said: “Businesses welcome any attempt to blunt the rise in business rates and the prospect of a more fundamental reform of a broken system. Chamber businesses have been calling for reform for years.
"The current arrangements are a barrier to investment and causes an unnecessarily large burden to be placed upon businesses regardless of their ability to pay.
“The Shadow Chancellor is right to highlight that reforming Business Rates must also be placed within a wider context of how businesses are taxed and the need to build a tax system fit for the future, including how online-only businesses are taxed. However, any changes must be done in close consultation with business.”