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BUSINESS innovation

HSBC is accused of conniving with very rich people to help them avoid paying their fair share of tax – and Labour takes up the chase with enthusiasm.  Ed Miliband prolongs a verbal spat with the Executive Chairman of Boots over the latter’s tax payments.  Andy Burnham widens Labour’s critique to include Amazon, Google and Starbucks. The party pledges to put UK overseas territories on an international blacklist if they don’t take new measures against aggressive tax avoidance.

As Henry Hill has pointed out, these gambits are evidence not only of Miliband’s instincts but his strategy.  He believes that scrabbling together 35 per cent of the vote will be enough to put him in Number Ten.  His deliberate prolongation of Labour’s row with business is crafted to win back switchers from the party to the Greens, keep a grip on left-wing defectors from the Liberal Democrats to Labour, and prevent any further slide of the party’s heartland voters to UKIP.

You can praise Miliband as the people’s hero, standing up to rip-off vested interests, or damn him as a child of privilege from Hampstead, who doesn’t grasp the difference between avoidance and evasion (and has questions to answer about his own family’s tax arrangements).  But, either way, his gamble may pay off.  The banking crash and the Great Recession seem to have hardened public attitudes towards business.

Like the reputation of MPs, the police, the media and a long, long list of other institutions, that of business has taken a knock.  A recent YouGov survey found that 49 per cent of respondents want government to stand up to big business, and only 31 per cent to support it.  Whether or not Miliband is able to exploit this vein of feeling, it bodes badly for bigger enterprises and perhaps for smaller ones, too – at least, if “ideas have consequences”.

It’s true that there’s no such animal as a single business interest – and, indeed, that those of big business aren’t necessarily the same as those of smaller ones. For example, the former can be large enough to bear regulatory burdens that can break the back of the latter: these, then, can actually help established business by keeping new rivals out of the marketplace.  Or consider, as a Financial Times report today reaffirms, the CBI’s different take on Britain’s EU membership from the IOD’s or the BCC’s.

It is bigger businesses, too, that tend to be in the forefront of campaigns against aspects of immigration control.  None the less, businesses of all sizes converge to agree on some points.  All want a better educated and skilled workforce, upgraded infrastructure, improved transport links, more competitive tax rates…and higher profits, without which there is less cash for investment, fewer jobs, and less tax revenue with which to pay for public services.

The Conservatives were the traditional party of capital, just as Labour was that of, well, labour.  That distinction, blurred under Tony Blair, is now reviving.  But business can no longer rely on politicians to make its case for it: they simply lack the credibility to do so.  Business for Britain is helping to show that enterprises can band together to push for a goal – “a better deal from the European Union”, in its own words.

Why is there no wider organisation campaigning convincingly for business – to communicate what it does for jobs, innovation, new technology, revenues, progress and public services?  Perhaps because business people tend to be less limelight-seeking than politicians and less cause-driven than, say, think-tankers.  They are naturally reluctant to thrust themselves under the media spotlight and thus let their tax affairs and family lives become fair game.

But they can’t rely on others to speak for them, shelter behind the membership organisations (such as the CBI or IOD), or complain that it is the duty of politicians to go before the cameras and defend the share of tax that business pays if they’re unwilling to do so themselves – if they want to flourish, anyway.  They need a long campaign which aims to have the reach of, say, 38 Degrees.  It might be called the Business Case, at least until someone thinks of something better.

 

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