After months of denying that she would call an early election, Prime Minster Theresa May has called for a general election on the 8th of June. Credico UK has been examining how unexpected development could impact small businesses, and whether after three years of political turmoil, small businesses are better equipped to handle uncertainty.
The snap election taking place on the 8th of June is for many, just the latest in a continuous string of political disruptions. While all eyes turn to the polls in the run-up to June, Credico UK has been examining what this snap election will mean to the UK’s Small business community. A community which has faced a deluge of political uncertainty over the last three years as a result of Brexit and the looming possibility of Scottish independence.
Credico UK has found that many small businesses have concerns that an early election could stunt their growth potential. In a survey of 200 small to mid-sized businesses by Wax Digital, political disruption was found to be the second biggest factor standing in the way of growth ambitions with 37 percent citing concerns, second only to worries about skill shortages. Furthermore, 4 out of 5 businesses surveyed claimed that political uncertainty over the last 12 months has already inhibited their growth.
One of the primary sources of uncertainty for small businesses is the lack of clarity surrounding pending legislation. In the run up to June 8th, Governments are prohibited from signing off on new legislation or making significant announcements as this could influence the public opinion of particular parties. Due to the speed of this year’s snap election, this means that draft legislation is now being deferred till after June the 8th, however, how much of this legislation will actually be revisited after the election, or scrapped instead is unknown. There is one small blessing to come as a result of this halt on Parliament however, the planned change in the tax on dividends has currently been shelved, which would have seen the current rate of tax-free dividends drop from £5,000 to £2,000.
Credico UK has concluded that while the General Election could be set to disrupt small businesses to some degree, they are confident that recent string of major political developments has done well to prepare businesses for future upheaval. ‘After the ambiguity of Brexit, Small businesses are more than equipped to weather the storm of a general election’ stated a spokesperson for the field marketing agency. ‘While there is potential for disruption, some benefits have risen from recent political events too, for example, the weakness of the pound has had an unexpectedly positive impact on export conditions. Small business owners and entrepreneurs are by nature great at seeking out opportunities like this; it’s what makes the UK’s business community so strong.’