>Except this is not true. The penalty and liability for getting the status determination wrong only exists if the client declares relationship to be out of scope. This means the risk averse businesses only offer in scope contracts...
Sorry but this simply isn't true. There is liability for getting determination wrong in either direction. Central government are facing a bill of at least £263M for doing exactly this. Applying a blanket ruling of pulling everything "inside" IR35 is equally liable to enforcement as you would blanket declaring everything "outside". The end result is fewer freelance contracts and a less flexible market, not a blanket ruling one way or the other.
You can see the evidence for this in this very publication a couple of months back: https://www.theregister.com/2022/05/26/mps_slam_ir35_government_rollout/
You don't fix the IR35 reform by further butchering tax law to carve out more exemptions for us based on the fantasy ideas that we take more risk or receive fewer benefits. You fix the IR35 reforms by rewriting the rules to be clear, establishing common contractual clauses and implementing a rapid review/appeals mechanism to give businesses the confidence that they're following the law so we can compete on price and quality, not who is willing to run the gauntlet of HMRC enforcement.
>I don't think you understand why people decide to start their own business
I do, as I've been freelance contracting in various guises for over a decade now. I want to compete on a level playing field. I don't want to be competing on price with someone who is quite happy to make no provision for holidays or sick pay in a race to the bottom to see who can work themselves to death first. Regulation exists to provide a minimum base standard, not encourage us to whittle away at the fabric of our workforce until nothing is left but cranking out 90-hour weeks for a fixed price.
But, again, how and how much we tax freelancers is a completely distinct issue from the IR35 enforcement reform. Don't confuse them like Mrs Truss is doing.