A poll of 1745 PCG members on the subject of IR35 taxation policy.
Date Published: 13 Jul 2009
Categories: Economy | Finance | Politics | Professionals | UK
PCG, the voice of UK freelancers and contractors, has delivered a grim warning to all political parties. Change the insidious IR35 tax policy or the vast majority of our members won’t be voting for you at the next general election.
An overwhelming majority of 91% stated they will be more likely to vote for a party that commits to abolishing the IR35 tax regulation, seen by most freelancers as complex and unfair to professionals running their own small businesses.
The figures emerged after an extensive online survey conducted by ComRes. The survey amongst PCG’s 18,500 members also investigated attitudes to the economy and the group’s deteriorating relationship with HM Revenue and Customs.
Commenting, PCG Managing Director, John Brazier, stated “This confirms just how damaging IR35 has been. There are an estimated 1.4 million business to business freelancers alone in the UK. As the parties draw up their manifestos, they cannot fail to take note of this level of discord- nine out of every ten of our members have essentially stated it will affect the way they vote. IR35 is a restrictive, unworkable, and unfair regulation and it’s high time for a fairer taxation system to be developed for freelancers.”
The survey, which generated 1765 responses, exposed a significant lack of confidence in HM Revenue and Customs by PCG members, with just 4% describing the Government department as “transparent”. Just 17% found that HMRC offered “competent advice”.
Mr Brazier said the negative opinion of HMRC by members was a real cause for concern: “It is a real shame that we cannot have a tax authority that respects the needs of the UK’s smallest businesses and in turn wins the respect of freelancers throughout the UK. These figures highlight major problems with the way in which freelancers are treated. Legitimate freelancers find it difficult to seek reliable, useful advice from HMRC on how they run their businesses and instead find themselves under suspicion at every turn”
Elsewhere in the survey, PCG members expressed pessimism about the current economic climate with only 19% expecting the economy to improve in the near future, and more than half (52%) expecting the situation to get worse. Demonstrating the resilience that often characterises freelancers, PCG members were less pessimistic about their own situations, with less than half (46%) expecting things to get worse.
Added Mr Brazier “These figures serve to underline the serious times we are now in. It is more important than ever for any future Government to commit to helping freelancers, as ultimately, they will have a key part to play in the UK’s economic recovery. With the specialist, flexible, knowledge based skills they provide, freelancers are essential in securing the UK’s future prosperity.”
1. The Professional Contractors Group (PCG), www.pcg.org.uk, was formed in May 1999 to provide independent contractors and consultants with a representative voice in opposition to the original IR35 proposals. Since then, PCG has evolved from being a single-issue campaign group to being a fully fledged, not-for-profit professional body representing knowledge workers who choose to be self-employed.
2. PCG has over 18,000 members working in a wide variety of sectors including oil and gas, engineering, information technology, management consultancy, marketing, telecommunications and pharmaceuticals.
3. The PCG/ ComRes online survey of 1,756 PCG’s members was carried out from 18 May to 22 May.