Liz Truss is cutting red tape for UK small businesses as bad news piles up

Small companies in the UK have just received some good news amid all the gloom and gloom lately.

Liz Truss, the popular new prime minister, said at a Conservative Party conference in Birmingham on Sunday that she would cut the red tape for tens of thousands of small companies, often seen as engines of economic growth. economic.

She will do so by adapting a rule rather than creating a new one — namely by changing how a small company is defined.

“By elevating the definition of a small business, in regulatory terms, from 250 to 500 employees, we will free up 40,000 more businesses from red tape,” Truss said in a statement.

That aspect of her plan will go well with nearly all small business owners, regardless of their political leanings.

Truss has been harshly criticized by the market and critics in recent days for its controversial small budget announced last month. Amid high inflation, her plan calls for the biggest tax cuts in decades, while boosting government borrowing and spending.

News of the plan — billed by the opposition Labor Party as “trickle economics” and criticized by some members of Truss’s own party—sent the pound plunging.

On Sunday, Truss told BBC she wishes she had “laid a better foundation” for the budget announcement, but insists she is sticking to her blueprint despite the market turmoil.

In particular, for many is the decision to cut taxes for the UK’s highest earners.

Meanwhile, three-quarters of British voters – including 71% of Conservative supporters in the last election – believe Truss and Kwarteng have “lost control” of the economy, according to a poll comments for The Observer by Opinium Released this weekend.

Truss ‘right to target growth’

However, Tony Blair, a former prime minister and leader of the Labor Party, said Truss was “right to set the growth target”.

While admitting his own focus would be different from Truss, he told host Ian Bremmer above GZeroWorld podcasts this weekend:

“You have to increase the rate of growth. One of the first things you notice in government is that if growth is strong, revenue is also high. If the revenue is high, you can spend money on public services. If growth is low or you’re in a recession, then suddenly things look worse and you have to cut services.”

Mark Littlewood, director general of the London Institute of Economics, told Sky News last month that deregulation and high taxes would limit economic growth, adding, “The rising tide will lift all all ships.”

Business Secretary Jacob Rees-Mogg talk about plans:

“Regulation supports incumbents, it supports big businesses against challengers. Generally, new jobs come from smaller businesses. You must not regulate them as if they were big businesses — you stop the growth, you won’t get the growth you need. This is not a frantic rush to get rid of all safety regulations. It ensures that the regulations are the ones you really need and relate to the real problems facing the business. “

Julia-Ambra Verlaine, who worked on Barclays forex trading desk before including markets for The Wall Street Journal, suggesting the UK and the pound could return. Asked on Magazine Thursday podcast where she will use different currencies now, she replied:

“I want the British pound. I think long term – I’ll take a gamble to get them back on track and I want to buy their currency low. ”

With the market Show some confidence In Truss’ plan so far, it remains to be seen how much sterling falls.

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