A Labour minister has sparked fury after appearing to suggest Britain's employers are not working people, prompting a backlash from a small business owner who warned his company could soon be forced to close.
Chief Secretary to the Treasury Emma Reynolds insisted there was a distinction between employers and employees when challenged about the pressure facing businesses following rises in National Insurance, inflation and the minimum wage.
Small business owner hits back
Her comments were branded insulting by pie seller Paul Bowen, who said small business owners across the country were being made to feel as though their hard work did not count. Speaking exclusively to GB News, Mr Bowen said: "It is so insulting to small business owners. I cannot believe she thinks we don't work. I speak for every small business. The plumber, butcher, hard grafter, bricklayer, construction home worker, cleaner, everyone. We feel insulted."
He challenged Ms Reynolds to visit his business in Chorley, Lancashire, and see for herself the impact of the Government's policies. He said: "Small business owners work more than the standard hours. You can't even put a contract on us because of the hours that we work. I want to show her that inside and outside of my business. I want to show her how minuscule the profit margins are right now. If we don't do something soon, that's it. We're shut."
Tax rises under scrutiny
The row erupted during an interview with Camilla Tominey on GB News, in which Ms Reynolds was also questioned about whether Labour had broken its manifesto promise by raising taxes on landlords and savers. The minister argued the changes amounted to "2% on the income tax bands that are in for property and for savings", insisting they were "not the same" as increasing income tax.
Asked about Mr Bowen's difficulties, she said: "I'd love to talk to Paul at some stage. I don't know which elements or which tax he is talking about in this Budget because we made a very conscious decision for the tax increases to be targeted and fair."
Mr Bowen said he was referring to the increase in dividend tax, accusing the Treasury minister of failing to understand how business owners and company directors receive their income. "She said she wants to know what tax we're talking about. I'm talking about the director's dividend tax. She did mention that she's supposed to be in the Treasury. She's supposed to know how directors get paid, how self-employed people get paid. They get paid via dividends. And that was a 2% increase on dividends. I'm not crying poverty, I'm just saying business owners yet again are being penalised."
Wider criticism
He warned that the consequences could extend to the 37 people employed by his business, admitting he could soon be left with no choice but to let staff go. "Imagine me turning round to 37 staff and saying, I'm sorry. We're going to have to close our doors. I'm sorry. I can't provide for you. That's it. It's heartbreaking. It's actually heartbreaking."
Mr Bowen, who previously appeared on BBC's The Apprentice, also said he would not benefit from the business rates relief highlighted by Ms Reynolds because he operates two stores. The minister had argued the Budget offered relief to tens of thousands of small businesses.
Conservative and Reform politicians joined the criticism. Shadow work and pensions minister Helen Whately said: "This attitude is why Labour is killing our economy. They don't understand businesses are built by hard graft. By working people." Reform UK's Treasury spokesman Robert Jenrick added: "Tell that to the millions of small business owners who employ people. Labour haven't a clue about business."
A Treasury spokesman said the Government had repeatedly demonstrated, despite a difficult global economic backdrop, that it would stick to its manifesto tax commitments. It added: "We are being fiscally disciplined whilst keeping our promises not to increase the rates of income tax, national insurance, VAT, or corporation tax."
