Tax breaks for all entering into employee-owned companies
John Lewis is a beckon of fair employment conditions with its cleverly executed employee-owned business model. It is this ingenious and forward thinking idea that business secretary Vince Cable intends to roll-out throughout the English business fraternity.
Cable is looking to put up £50m worth of tax breaks to incetivise the scheme and the government has backed the plan with the launch of the first national Employee Ownership Day which will aim to guide businesses move to this style of business ownership.
Cable declared at the conference in London, “The evidence is clear that employee-owned businesses not only help us build a stronger economy, but boost the retention, innovation and motivation of their employees.”
This feeling was echoed by Danny Alexander, Treasury chief secretary, who said: “The employee ownership sector has huge potential and the government wants to support it as much as possible. Employee ownership is of significant benefit to the wider economy, through increased growth and business success and this business model will also add greater diversity to our economy.”
It is still unclear how exactly the tax breaks will be awarded although there is current consultation on a two-pronged attack, this includes a capital gains tax relief, the other being to pay staff an annual bonus free of income tax and national insurance.
However the initiative is first and foremost a great tool to encourage good working conditions and attitudes from the ground up and for those interested in getting involved, there is to be a number of events to discuss the employee-owned business model.
The government are eager to prove their mandate for growth and believe this is one of many inspiring ideas which in this case have been proved very successfully with John Lewis making it a great roll-out opportunity.
Deputy Prime Minister Nick Clegg said” Giving hard-working people a real stake in their company is a hugely underused tool in unlocking growth. This straightforward new guidance will help firms of all sizes realise their potential, boosting staff motivation and laying the foundations for growth,”