CONTRACTORS OPPOSE UPCOMING IR35 TAX CHANGES
New research suggests that 85 MPs could lose their seats over the issue of new off-payroll tax rules as independent contractors say they would vote against their MP if they were to support the changes.
The 2018 Autumn Budget included plans to bring in new tax legislation for contractors in the private sector from April 2020 that will see many having to be taxed as employees but without getting staff benefits such as sickness and holiday pay.
The IR35 tax rules have already caused problems for contractors working in the public sector. In September, an independent contractor won her case to get holiday pay after IR35 tax rules forced her to work as an employee.
ContractorCalculator has found that the IR35 proposals are so unpopular that 49% of 2,000 independent contractors polled said they would vote against their local MP at the next election if their MP were to support the off-payroll rules.
It means that 85 MPs are at risk of losing their seats in parliament at the next general election if they do not back contractors over the IR35 plans. These MPs have small majorities and their constituents include thousands of independent contractors, according to figures from the Office for National Statistics (ONS).
Both Labour and Conservative MPs are affected; of the 85 MPs, Zac Goldsmith, Amber Rudd, Justine Greening and Anna Soubry are among the top 20 Tory MPs who are vulnerable.
"Of the vulnerable MPs, there are 40 Conservative and 24 Labour politicians and the Conservatives appear to have a lot more to lose than Labour," said Dave Chaplin, CEO and founder of ContractorCalculator.
"The recent off-payroll announcement, and multiple draconian measures before it, won't have done those vulnerable Tory MPs any favours, as they now face an uphill task if they want to save their seats."
Chaplin added: "Failure to secure the self-employed vote would prove catastrophic for all parties involved. There is also potentially a lot to gain for some, but those in precarious positions will have to act swiftly and earnestly to win over contractors' trust … Self-employment is on the rise and the self-employed vote will prove crucial to either party's fortunes at the next election. I would suggest that no party ignores the needs of these important voters."