Reform unveils plan to ‘save’ British businesses by slashing red tape and axing ‘ridiculous EU laws’
Reform UK has launched a fresh pro-business programme aimed at reducing what it describes as excessive regulation and tax burdens on Britain’s small businesses. The party says its proposals would make it easier for entrepreneurs to start and expand companies, while giving workers greater financial rewards for working overtime.
The announcement comes as Reform seeks to strengthen its economic credentials and present itself as a serious alternative to Labour and the Conservatives. The package includes changes to national insurance, VAT, overtime taxation, data protection rules and the UK’s electric-vehicle mandate.
At the centre of Reform’s argument is the claim that Britain’s small businesses have been burdened by years of complicated regulation. The party says there are around six million small businesses in the UK and describes them as the backbone of the economy.
One of the most controversial proposals involves the General Data Protection Regulation, commonly known as GDPR. Reform wants to scrap the current framework and replace it with a lighter system modelled on New Zealand’s privacy laws.
Robert Jenrick, Reform’s Treasury spokesperson, has argued that GDPR places unnecessary burdens on small firms and technology companies. The party says a less complicated system would allow businesses to spend less time dealing with compliance and more time developing products, employing people and investing for growth.
The proposal is likely to generate considerable debate, however. Data-protection rules do not exist solely to create obligations for businesses. They also give individuals rights over how their personal information is collected, stored and used.
Any attempt to loosen those protections would therefore need to demonstrate that reducing compliance costs would not leave consumers significantly more exposed to misuse of their personal information. This could become particularly important as artificial intelligence companies increasingly depend on large quantities of data.
Reform’s position is that Britain should be able to establish its own regulatory framework now that it has left the European Union. The party argues that the UK should not continue following rules designed principally around the interests of the EU.
The argument has an obvious political appeal to voters who supported Brexit because they wanted greater British control over domestic law. But there is a practical complication: British businesses that trade with the European Union may still need to comply with EU rules when selling products or services into the bloc.
This means that eliminating a regulation domestically does not necessarily eliminate the cost of compliance for companies that operate internationally.
The Labour government has taken a somewhat different approach. Ministers have repeatedly said they want to reduce unnecessary barriers to trade with the EU while maintaining their commitment not to rejoin the Single Market or Customs Union. The Government argues that selective regulatory cooperation can reduce costs for British businesses and encourage economic growth.
That creates a fundamental difference between the two approaches.
Reform emphasises regulatory independence and the removal of rules it considers unnecessary. Labour is pursuing closer practical cooperation with the EU in selected areas where ministers believe this can reduce barriers for British exporters.
Neither approach is automatically cost-free.
For Reform, the challenge will be demonstrating that deregulation produces tangible economic benefits rather than simply reducing the number of rules on paper. Businesses need regulations that are clear and proportionate, but they also need predictable standards, consumer confidence and access to international markets.
The party is also proposing a substantial increase in the VAT registration threshold, from £90,000 to £150,000. Reform argues that this would reduce the incentive for small companies to remain artificially below the existing threshold and give entrepreneurs more room to grow.
For some small firms, avoiding the administrative complexity associated with VAT could be attractive. But raising the threshold could also have implications for government revenues and competition between businesses below and above the threshold.
Reform says it would also reverse the increase in employer national insurance introduced under the previous Labour government. The party presents this as a way of reducing the cost of employing British workers and encouraging companies to create jobs.
Employment taxes are particularly important for small businesses because labour costs can have a direct impact on whether a company hires another employee. Supporters of Reform’s proposal will argue that reducing the tax burden could stimulate employment and investment.
Critics, however, would question how the resulting loss of government revenue would be replaced. Any reduction in taxation has to be considered alongside spending commitments, public services and the overall state of the public finances.
Another eye-catching proposal is Reform’s plan to remove income tax from overtime. The party calls this a “Hard Work Bonus” and says it would reward people who choose to work additional hours.
The proposal is designed to appeal directly to workers as well as employers. Reform’s message is that people who work harder should be able to keep more of what they earn.
But designing such a system would require careful consideration. Policymakers would need to determine what qualifies as overtime, how self-employed people would be treated and how employers would report eligible earnings. There could also be questions about whether tax-free overtime would encourage employers to rely more heavily on additional hours instead of hiring new staff.
Reform has also announced plans to expand the Seed Enterprise Investment Scheme, allowing greater tax incentives for family members who invest in businesses founded by their children or grandchildren. The objective is to increase the flow of private capital into new companies.
Access to finance is a significant challenge for many young businesses. Entrepreneurs can have viable ideas but struggle to obtain investment, particularly during their earliest stages. Encouraging families to provide capital could therefore help some companies survive and expand.
However, tax incentives always carry a cost to the Treasury. The Government would need to assess whether the additional investment generated is sufficient to justify the tax relief provided.
Reform has also pledged to scrap the 2035 zero-emission vehicle sales mandate. The party argues that the policy puts unnecessary pressure on tradespeople and businesses that rely on vehicles and could increase costs for consumers.
Again, the debate involves competing priorities. Businesses want affordable and practical transport, while policymakers are also under pressure to reduce greenhouse-gas emissions and encourage the transition towards cleaner vehicles.
Removing regulatory requirements could give businesses more flexibility, but it could also slow the transition to electric vehicles. The economic consequences would therefore depend partly on how quickly technology and consumer demand develop.
The wider issue is what Britain wants its regulatory system to achieve.
Regulation can undoubtedly create costs. Businesses may have to employ compliance staff, complete forms, maintain records or adapt products to meet government requirements. Excessive bureaucracy can particularly affect small firms that cannot afford large legal or administrative departments.
But regulation also exists for reasons. Employment protections, consumer rights, environmental standards, financial safeguards and privacy rules can prevent businesses from shifting costs or risks onto workers, customers and society.
The challenge is finding the right balance.
Reform’s argument is that Britain has tilted too far towards regulation and that a smaller regulatory burden would unleash entrepreneurship. The Government will need to demonstrate whether those proposed changes can deliver stronger growth without weakening important protections.
The political timing is significant. Reform is attempting to establish itself as a credible party of government rather than simply a protest movement. Economic policy is therefore becoming increasingly important to its identity.
The party has already been seeking to expand its appeal beyond immigration and border policy. Its new business proposals are clearly designed to reach entrepreneurs, self-employed workers and employees who feel that taxation and bureaucracy have become too burdensome.
That could put pressure on the Conservatives, traditionally the main party of the British political right and the party most associated with lower taxes and business-friendly policies.
Reform’s challenge is to convince voters that its proposals are financially credible as well as politically attractive.
Promises to cut taxes and regulation can be popular, but voters may also ask how lost revenues will be replaced and whether public services would be affected. A convincing economic programme therefore needs to explain both the benefits and the costs.
There is also an important distinction between removing unnecessary bureaucracy and abolishing useful safeguards. The strongest version of Reform’s argument is not that all regulation is bad, but that rules should be proportionate, understandable and justified by a clear public benefit.
Britain’s small businesses would benefit from a regulatory system that is easier to navigate. But they also depend on public confidence. Customers need to know that their personal data is protected, employees need basic workplace rights and investors need confidence that markets operate fairly.
Deregulation that undermines those foundations could ultimately create new costs.
The debate over Brexit provides another important dimension. Previous Conservative governments also promised to use Brexit freedoms to remove retained EU legislation and reduce regulatory burdens. Official government plans under the previous administration identified potential savings from reforms to retained EU-derived regulations.
Reform is therefore not the first political party to argue that Brexit should lead to significant deregulation. Its proposal represents a more aggressive continuation of that philosophy.
The question now is whether voters believe the benefits would outweigh the risks.
For British businesses, the answer may depend on their individual circumstances. A small technology company could welcome lighter data regulations. A manufacturer exporting to Europe might prefer regulatory alignment that makes cross-border trade easier. A family-owned business could benefit from investment incentives, while a company with many employees could welcome lower employment taxes.
There is unlikely to be one universal business view.
That makes the policy debate particularly important. Reform will need to explain how its programme would operate across different industries and how it would avoid creating new barriers for companies that trade internationally.
The party’s latest announcement nevertheless represents a significant attempt to reshape the economic debate.
Rather than simply criticising Labour’s tax and spending policies, Reform is offering a clear alternative centred on lower taxes, fewer regulations and greater incentives for work and investment.
Whether that becomes a successful economic strategy will ultimately depend on the details.
Britain needs businesses that can invest, employ people and compete internationally. It also needs sufficient tax revenues to fund public services and sensible rules that protect workers and consumers.
Reform’s proposals force those competing priorities into the open.
The party says it wants to “unchain” British enterprise and give small businesses greater freedom. The Government will have to explain why its own approach is better, while Reform will need to demonstrate that its proposed tax cuts and deregulation can be funded and implemented without creating serious unintended consequences.
For voters, that may be the most important question of all.
Cutting red tape is an attractive political slogan, but the real test is whether a business owner can actually spend less time dealing with bureaucracy, whether an employer can afford to hire another worker, whether an entrepreneur can obtain investment and whether British companies can compete more successfully at home and abroad.
If Reform can demonstrate measurable improvements in those areas, its economic agenda could become one of the party’s most powerful political weapons.
If it cannot, critics will argue that the programme amounts to a collection of expensive tax cuts and weakened protections rather than a coherent plan for growth.
The coming political debate will therefore be about much more than “ridiculous EU laws”. It will be about what kind of economy Britain wants—and how much regulation, taxation and government intervention is necessary to build it.