Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment her Department has made of the suitability of the current asset and employee number eligibility caps for the Enterprise Management Incentive in supporting the fastest-growing tech startups in the UK.

The Enterprise Management Incentive (EMI) scheme is a tax-advantaged share scheme, which allows SMEs to attract and retain high productivity workers that they otherwise would not be able to recruit due to insufficient cashflow compared to larger, more established companies. The asset and employee number eligibility caps ensure the scheme is targeted at those small companies most affected by this issue.

At Spring Budget 2022, a review of EMI concluded that the scheme and its limits remain “effective and appropriately targeted.” Following this evaluation, Company Share Option Plan (CSOP) was expanded from April 2023 in order to support companies as they grow beyond the scope of EMI.

The Government keeps all tax reliefs under review, to ensure they continue to meet their policy objectives in a way that is fair and effective.