Friday, February 17, 2017

Small businesses plead for tax dodge while workers are denied justice

Today’s news features the objections from businesses in some areas to the revaluation of business rates. In particular, the Federation of Small Businesses (FSB) are calling on the Chancellor to increase small business rate relief (i.e. letting them get away without paying tax). The FSB whine about the costs of providing their staff with pensions and other aspects of Government policy.

But the FSB don’t mind some occasions when the Government takes money off people hardly able to afford it. In a recent report on the dramatic reduction in access to justice since the introduction of employment tribunal fees, Martin McTague, policy director at the FSB, defended their introduction, claiming that "Tribunal fees have brought down the number of claims with no merit. Before this, the balance of justice had tipped unfairly against smaller employers that struggled with a rising tide of vexatious claims. Fees must be set at a level that enables justice but prevents unreasonable claims." Employment tribunal claims have fallen by 70% since the introduction of fees, and it is quite clear that many workers with entirely reasonable claims are being denied justice (for example an employer can happily make an unauthorised deduction from a worker’s salary if it is less than the fee the worker would now have to pay to complain about this theft to a tribunal).

The FSB estimate that the tax dodge they are pleading for would cost the Government £100 million a year. Government figures show that employment tribunal fees currently raise less than £10 million a year. The same Government review of employment tribunal fees reveals that in 2015/16 the overall cost of Employment Tribunals (including the costs of the Employment Appeals Tribunal) was £66 million (a reduction from £71 million in 2014/15 and £76.3 million in 2013/14).

In other words, small businesses in London are demanding an annual subsidy from the Exchequer which is half again the total annual cost of the entire employment tribunal system, whilst gleefully celebrating the Government’s denial of justice to so many working people.


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