EOA Response to Treasury Review of Employee Ownership
The EOA has responded to the Treasury Review on Employee Ownership .
In addition to submitting a formal response which can be downloaded below, the EOA arranged for a series of meetings between member organisations and Treasury officials to make representations on specific taxation and relief measures.
The Employee Owned network welcomed the Review when it was announced by the Chancellor in the April Budget Statement.
Most of our Members would like to see modern, supportive arrangements come from the Review to incentivise the creation of more businesses that are entirely or largely owned by their workforces.
The two most common technical ‘asks’ of employee owned businesses in our network continue to be reform of the way Employee Benefit Trusts are taxed (including rules around EBTs as vehicles for performance related pay arrangements), and the removal of the 10 year rule on distribution of shares via a SIP Trust.
Employee owned businesses in the UK remain supportive of tax incentives that might encourage individual share ownership in businesses in which a small or tiny minority of employees will have an ownership stake – but continue to see such incentives as largely being a different agenda.
Representations have also sought to highlight concerns at recent Government tax proposals encouraging individual share ownership in businesses, partly because they are so disconnected from the advice Government received via the Nuttall Review and risk appearing to have ignored that advice, and partly because the proposals are being legislated for ahead of the findings of your Review and the outcomes of the consultation process about the proposals.