In Derek’s West Cornwall constituency, 87% of businesses are classed as ‘micro businesses’ employing less than 10 employees.
Despite providing the lion’s share of jobs in the area and despite their hard work and commitment, small business owners have, in recent years, faced a number of challenges which make running their business a challenge. These include rising operational costs, increasing red tape and the difficulty of attracting credit.
Derek meets regularly with small business owners and regularly lobbies on their behalf in Westminster. One of the issues he has been most associated with has been to try to ensure that business owners, particularly in St Ives, have not been overly disadvantaged by the publication of the new rateable values by the Valuation Office Agency.
Derek continues to argue that the UK’s imminent departure from the EU offers the Government an ideal opportunity to reform what he sees as an out-dated and unfair Business Rate system.
15th January, 2016
Holds a small business drop-in surgery in Helston.
22nd January, 2016
Holds a small business drop-in surgery in Penzance.
5th February, 2016
Holds a small business drop-in surgery in St Ives.
12th February, 2016
Meets Ann Vandermeulen, Development Officer for the Cornwall FSB (Federation of Small Businesses), in Penzance.
10th June, 2016
Holds follow-up meeting with Ann Vandermeulen at the Royal Cornwall Show.
4th October, 2016
Meets traders from Penzance’s Lower Quarter to hear their concerns.
3rd December, 2016
Visits retailers in Helston as part of Small Business Saturday.
Derek discusses the possibility of raising the VAT threshold by 50% to help small businesses with Treasury Minister David Gauke. He argued that many small businesses were under increasing financial pressure due to the introduction of auto-enrolment work-based pensions, business rate re-evaluations and the introduction of the National Living Wage.
He said that lifting the threshold to £120,000 would have a beneficial impact.
“It’s clear that there is an economic vacuum created during off-season periods in areas which are heavily dependent on tourism such as in West Cornwall and the Isles of Scilly ,” he said.
“Small businesses often reduce their economic activity in order to remain within the current threshold which not only compresses the tourist season into a few short months but also has a negative impact on employment opportunities for workers and reduces the tax the Government can collect through PAYE.
“Raising the tax threshold will create an incentive for tourism small businesses to open for longer periods each year, put more money into the local economy and invigorate rural high streets.”
4th February, 2017
Hosts business breakfast at the Queens Hotel, Penzance. Mark Harper, MP for the Forest of Dean and the leader of the South West Conservative MPs’ group, answers questions from more than a dozen local business leaders on a variety of topics including Brexit and business rates.
Derek writes to all the small businesses in St Ives asking them for details about the rent they were paying and to see if they wanted assistance.
He follows this up by challenging each individual case and requesting that the Valuation Office Agency undertakes a revaluation of the whole of St Ives.
17th March, 2017
Derek hosts meeting of members of the Cornwall FSB in his Penzance constituency office. Business rates was a major topic of discussion.
19th April, 2017
At Prime Minister’s Questions, Derek calls on the Prime Minister to help small businesses which are being hit by rising costs and increasing red tape. He asks Mrs May to meet with him to discuss what the Government can do to help small business owners so that they could continue to be the engine of rural economies like West Cornwall.
The Prime Minister said that Mr Thomas had been a “champion” of small businesses in his constituency and added that the Government had made £435 million available in the Budget to support businesses facing the steepest business rate increases after Mr Thomas and other MPs highlighted the inequalities of a revaluation of business premises which resulted in some businesses facing massive increases in their business rates.
The Prime Minister also agreed to discuss small businesses with Derek when she visited Cornwall in May.
7th July, 2017
St Ives business owners meet staff from the Valuation Office Agency (VOA) to discuss their valuations.
Derek joins with the FSB to urge business owners who rely on staff from a migrant workforce to provide important evidence ahead of proposed future legislation.
“The government has commissioned the Migration Advisory Committee (MAC) to advise on the economic and social impacts of the UK’s exit from the European Union and how the UK’s immigration system should be aligned with a modern industrial strategy.
“Many business owners will be concerned that new red tape will make it harder and more expensive to get the skilled workers that they need post Brexit,” he said.
“I encourage all business owners to make their concerns known to the Migration Advisory Committee as soon as possible.”
18th October, 2017
Leading a debate in the House of Commons, Derek highlights three key areas – Business Rates, the VAT threshold and the introduction of quarterly digital tax reporting - which he believes require reform.
“I believe that the Government needs to scrap the system of business rates and develop a fresh solution, injecting fairness into the tax system for small businesses and taking into account the growth of online shopping and supermarket home delivery services,” he said.
“Structurally there are many things wrong with business rates. The tax bears little or no relation to underlying profits and the way it is calculated is arbitrary.”
He also called for the current VAT threshold of £85,000 to be raised, possibly to £120,000 and urged the Government to “proceed with great caution” toward its stated aim of having a fully digital tax system by 2020.
Responding to Derek’s speech, Mel Stride, Financial Secretary to the Treasury, said there were arguments both for and against the idea of raising the VAT threshold and so he had asked the Office of Tax Simplification to consider the registration threshold as part of its current review of VAT.
Regarding progress towards the Government’s target of having a fully digital tax system by 2020, Mr Stride also recognised that there was “concern about the scale and pace of change”.
The Treasury had made the decision that businesses will not now be required to join Making Tax Digital until April 2019, and then only to meet their VAT obligations while businesses with turnover below the VAT threshold will be able to choose whether to take part.
7th November, 2017
Office of Tax Simplification publishes its review of VAT.
Its first recommendation is that: “The government should examine the current approach to the level and design of the VAT registration threshold, with a view to setting out a future direction of travel for the threshold, including consideration of the potential benefits of a smoothing mechanism.”