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A resounding success
Key points
- The impact of changing behaviour through the introduction of a specific tax incentive can be seen with the introduction of employee ownership tax relief for vendors.
- The indirect employee share ownership (EOT) was modelled on the ownership structure of John Lewis.
- Employee ownership trusts and converting to indirect employee ownership to apply for that tax relief allows retiring entrepreneurs to preserve the independence and legacy of their business while cashing out.
- The 2014 EOT legislation has worked from the start without requiring any changes to the legislation although there are some areas for improvement.
- One alternative SPV might be a common ownership worker co-operative as proposed by Co-operatives UK.
One of the problems that advocates of the use of tax incentives to encourage economic growth face is that it can be quite hard to objectively demonstrate that a particular tax incentive is having a meaningful economic effect...
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