All eyes are on Chancellor Rachel Reeves today as she gears up to deliver the government’s Spring Statement, but while it’s expected to be a much quieter affair than November’s budget, new figures from Tech Nation suggest the country’s high-growth businesses would welcome a radical rethink of tax policy.

Publishing its latest Founders Pulse in response to the government’s Call for Evidence, the trade body warned that the UK tax system has become a brake on growth, with founders voicing frustration over unpredictable changes and regulatory demands that add layers of complexity.

Among the biggest issues flagged by entrepreneurs are the limits of the current Enterprise Management Incentive (EMI) scheme – designed to let smaller firms offer tax‑efficient, competitive share options – which they argue restricts the ability to attract and retain top talent, particularly in fast‑scaling sectors such as AI and deep tech.

Founders are also struggling with the R&D tax relief system, finding it too complex and inaccessible, with complaints that this has hindered innovation in tech-driven industries.

The figures show that, despite Labour’s growth‑first messaging since taking office, UK founders are so far unimpressed by efforts to cut red tape and taxes, with 76% of Pulse respondents reporting they have considered relocating their tax residency or their company HQ outside the UK.

According to the study, one respondent went as far as to say they “hadn’t spoken to a single entrepreneur in the last year” who hadn’t considered relocating outside the UK.

In many respects, founders’ demands are broadly in step with the government’s ambitions, with founders seeking a tax system that rewards risk, scales with the needs of a growing company, and attracts globally competitive talent.

More than that, founders say tax compliance needs to be far simpler, freeing them to focus on building their businesses rather than wrestling with red tape, a challenge the government has sought to address by giving regulators such as the CMA and FCA new mandates to support growth.

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Although Tech Nation did not detail the size of this latest sample, its earlier poll of over 300 founders ahead of November’s budget revealed similar sentiments, with half keen for the government to introduce a simpler tax system, and three in 5 wanting tax relief schemes, especially R&D credits, made more predictable.

Now, with Reeves about to take to the despatch box, Tech Nation is calling on the government to double R&D funding limits through SEIS Gen-2, a proposed expansion of the UK’s Seed Enterprise Investment Scheme, to address the high cost of innovation in sectors like AI.

The trade body also wants a reintroduction of Entrepreneurs’ Relief, with a £10m lifetime limit and a 10% rate, which it argues would make it more rewarding for new firms to scale and reinvest in the UK, as well as higher limits and new tiers for EMI schemes, to ensure key talent is retained through hyper-growth.

“The UK has incredible potential to lead the world in entrepreneurship, but we need tax policies that reflect the ambitions of its founders,” said Tech Nation. “We are working hard to ensure that the government listens and implements the changes needed to keep the UK at the forefront of global innovation.”

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