As we near the 2024 elections, the manifestos released by the major political parties lay out their visions for the future of the UK's economy and society. The hair and beauty sector, a significant contributor to the economy and an integral part of many people's daily lives, stands to be impacted by these proposals. Here’s a breakdown of what the key parties are proposing and what it could mean for the hair and beauty sector.
Conservatives
The Conservatives aim to cut taxes and support business growth with the following key points:
Tax Cuts and Financial Support: Promises to cut employee National Insurance and eventually abolish self-employed National Insurance will directly benefit salon owners and freelancers in the beauty industry. The proposal to keep tax incentives like EIS and SEIS will encourage small business investments.
Business Rates and VAT: Adjustments to business rates, particularly the increase in the multiplier for distribution warehouses, aim to level the playing field for physical stores versus online shopping giants. Keeping the VAT threshold under review and explore smoother transitions for businesses nearing the threshold.
Access to Finance: Improved access to finance for SMEs and specific funds like the £250 million Invest in Women fund could provide crucial capital for beauty entrepreneurs, particularly women and disabled entrepreneurs.
Wages: Maintain the National Minimum Wage at the thirds of median earning (rising to around £13 an hour).
Education and Skills: Retain the apprenticeships levy and create 100,000 more apprenticeships in England a year.
Aesthetics: The introduction of new licensing schemes for non-surgical cosmetic procedures ensures that only qualified professionals provide these services, potentially raising standards across the industry.
Labour Party
The Labour's manifesto centres on wealth creation and equitable growth, with several points pertinent to the hair and beauty sector:
Economic Stability and Taxation: Labour’s promise of economic stability with a new partnership with businesses could provide a more predictable environment for salon owners. The cap on corporation tax at 25% and replacement of business rates might relieve some financial pressure on high street beauty businesses.
Apprenticeships and Training: By transforming Further Education colleges into specialist Technical Excellence Colleges and reforming the apprenticeships levy through a growth and skills levy.
Support for SMEs: Actions on late payments and reforms to the British Business Bank are designed to improve the financial health of small businesses, which is critical for many independent salons and freelance beauty professionals.
Liberal Democrats
With a focus on supporting small businesses and communities, the Liberal Democrats' proposals include:
Business Rates Reform: Replacing business rates with a Commercial Landowner Levy could lower costs for many small businesses in the hair and beauty sector, making it easier for them to thrive.
Sustainability Incentives: Encouraging businesses to adopt sustainable practices by introducing a duty of care for the environment might push salons to adopt greener practices, appealing to eco-conscious customers.
Green Party
The Greens emphasise a transition to a green and circular economy, with policies that could reshape the business environment:
Tax Adjustments: Changes to National Insurance and VAT, as well as increased windfall taxes on oil and gas, could indirectly impact disposable incomes and spending habits of consumers, affecting client spending in beauty services.
Sustainability: A carbon tax to decarbonise supply chains may encourage beauty businesses to adopt more sustainable products and practices, aligning with a growing consumer trend towards eco-friendly services.
Scottish National Party (SNP)
The SNP focuses on decisions made in Scotland for Scotland, advocating for:
Economic Independence and Tax Powers: Full devolution of tax powers could lead to a tax environment better suited to local businesses, including hair and beauty salons.
Green Energy and Infrastructure Investments: Investments in infrastructure and green energy could lead to lower operational costs and a more sustainable business environment.
Plaid Cymru
Plaid Cymru aims to redress economic unfairness with several measures:
Support for High Streets: By reforming business rates and investing in local high streets, Plaid Cymru plans to help small businesses, including beauty salons, to withstand rising costs.
Apprenticeships and Skills: Implementing an apprentice living wage and supporting colleges will help in developing a skilled workforce for the beauty industry.
Reform UK
The Reform UK overall theme is pro SME and cutting red tape.
Corporation Tax: Free over 1.2m small and medium sized businesses from corporation tax; lift the minimum profit threshold to £100k. Reduce the main rate from 25% to 20% then to 15% from year 3.Cut Red Tape: Abolish IR35 rules to support sole traders and cut business red tape.
VAT: Lift the VAT threshold to £150,000.
Business rates: Abolish business rates for high street SMEs offset by an online delivery tax at 4% for large multinationals. Cut entrepreneurs tax to 5%.
Minimum Wage at £15 per hour for all.
The 2024 party manifestos offer a variety of proposals that could significantly impact the hair and beauty sector. From tax cuts and financial support to reforms in business rates and investments in training, each party presents a mix of risks and opportunities. Business owners and professionals in the sector should stay informed.