Conservative backbencher Sir John Redwood has called for Prime Minister Rishi Sunak to reverse the “very bad deal” IR35 is bringing to self-employed workers.
Appearing on Sky News over the weekend, Redwood said: “I think, first of all, the self-employed are getting a very bad deal.
“I think we should reverse the 2017 and 2021 changes to so-called IR35. We want to promote more self-employment – make it easier for people to get into self-employment.
“That is the quickest way to expand capacity.
“Then I think we need to look at business taxes. I don’t think the Corporation Tax delayed increase will raise the money The Treasury and the OBR think it will.
“All the evidence is, in the past, when Conservative governments have had the courage to cut the Corporation Tax rate – never a popular move – it raises more money.”
Conservative backbencher, Sir John Redwood says the government should cut corporation tax despite the chancellor saying there isn't fiscal headroom for cuts at the moment #Ridge https://t.co/ZoMhCmTrtv
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— Sophy Ridge on Sunday & The Take (@RidgeOnSunday) February 12, 2023
The highly controversial changes to off-payroll working tax rules came into force in 2012, with a year’s delay due to Covid-19.
The legislation mans medium to large-scale businesses are responsible for determining the IR35 status of contractors they hire.
The reform was set to be repealed as part of the mini-Budget in September 2022, before the plans were abandoned by new Chancellor Jeremy Hunt.
IR35 insurer Qdos has welcomed calls from Sir John to reverse the off-payroll working rules,
The he firm’s chief executive, Seb Maley, said: “Millions will welcome Sir John Redwood’s comments. Whichever way you look at it, IR35 reform has damaged flexible working in the UK,” Mr Maley said, “It’s made it harder to work self-employed and harder for businesses to engage these workers – at a time when the economy desperately needs the skills and flexibility of independent workers.
Reversing IR35 reform would be the fair and logical thing to do
“Rishi Sunak himself saw through IR35 reform in the private sector when Chancellor. So he’s no stranger to this legislation, nor the challenges it has created. Reversing IR35 reform would be the fair and logical thing to do.
“However, when it comes to IR35, the government has anything but fair and logical. Its head has been buried in the sand for years.”
Earlier this year, Qdos released the finding of a survey that showed that despite the rising cost of fuel bills, more than one-third of contractors say IR35 is higher on their list of concerns.