The three main parties have published their manifestos – what did they say?

The three main parties have now all published their manifestos. They have all included separate costing supplements alongside their manifestos, which often contain tax detail missing from the main documents.

Here is a brief summary of the elements of most interest from a taxation perspective. There are marked differences between the parties, with Labour planning to spend an extra £82.9bn by 2023/24, the LibDems £51.36bn in 2024/25 (after adjustment for the September 2019 Spending Round) and the Conservatives just £2.9bn by 2023/24.

At the time of writing, a Conservative majority is around 2/5 odds on (according to Oddschecker.com) and the party’s odds on winning the most seats is around 1/20 on. However, political betting, like opinion polls, has not had a good track record of late.

Party Conservative Labour Liberal Democrat
Documents Manifesto Costings Manifesto Costings Manifesto Costings
Income tax – Guarantee rates will not rise.
– No comment on £80,000 higher rate threshold.
– Introduce the 45% tax band at £80,000 and start a new 50% band at £125,000 (where personal allowance tapering ends).
– Scrap marriage allowance.
– Single status of ‘worker’ for all but “genuinely self-employed”.
– A 1p rise on the basic, higher and additional rates.
– Scrap marriage allowance.
– Review IR35 changes.
– Review tax status of employees, dependent contractors and freelancers to ensure fair and comparable treatment.
– End retrospective tax changes “like the loan charge”.
Capital gains tax – “Review and reform Entrepreneur’s Relief” – Scrap annual exemption and tax gains as income after a de minimis allowance of £1,000 and a return adjustment linked to 10-year gilt yields.
– Entrepreneur’s Relief scrapped, and a replacement to be considered.
– Scrap annual exemption and set gains against any available personal allowance.
– All gains taxed as income.
National insurance – Increase primary threshold to £9,500 in 2020/21, with “ultimate goal” of £12,500.
– Guarantee rates will not rise.
– Employment Allowance increased to £4,000.
– National insurance contributions frozen, at least for individuals. – Review national insurance status of employees, dependent contractors and freelancers “to ensure fair and comparable treatment”.
Inheritance tax – No comment – Scrap residence nil rate band. – No comment.
Stamp duties – Additional 3% SDLT on residential purchase by non-resident individuals and companies. – Introduce wide-ranging Financial Transactions Tax raising £8.8bn annually. – SDLT to be graduated according to energy rating of property.
– SDLT surcharge on purchase of second homes by overseas residents.
Wealth tax – No comment. – No comment. – No comment, but would “ensure that income earned from wealth is not privileged when compared to income from employment”.
Second homes – No comment. – Second homes levy on holiday homes at 200% of council tax. – Local authorities allowed to increase council tax by up to 500% on second homes.
Universal Credit – “…continue the roll-out.” – Scrap Universal Credit and design alternative system.
– Until new system introduced, implement emergency reforms, including interim payment of half monthly payment.
– “Explore” universal basic income.
– Reform Universal Credit to be more supportive of the self-employed.
– Reduce first benefit waiting period to 5 days.
Corporation and business tax – Keep corporation tax rate at 19%, reversing current legislated decline to 17% in 2020.
– Increase R&D tax credit rate to 13% and review the definition of R&D.
– Raise mainstream corporation tax rate to 21% in 2020/21, 24% in 2021/22 and 26% from 2022/23.
– Reintroduce small profits rate at 19% in 2020/21, 20% in 2021/22 and 21% from 2022/23.
– Review of corporate tax reliefs aimed at raising £4.3bn annually.
– R&D funding would be reformed, creating a £4.0bn savings.
– Entrepreneur’s Relief scrapped, and a replacement to be considered.
– Raise to 20%.
– “Simplify business taxation to lower administration costs.”
Business Rates – Reduce business rates “via a fundamental review of the system”.
– Initial £320m one-year reduction aimed at small businesses.
– A review of the possibility of replacing business rates with a land value tax. – Replace in England with a Commercial Landowner Levy based solely on the land value.
Gig Economy – “…ensure that workers have the right to request a more predictable contract and other reasonable protections.” – Single status of ‘worker’ for all but “genuinely self-employed”.
– Ban zero-hour contracts.
– Give individuals who work regular hours for more than 12 weeks a right to a regular contract, reflecting those hours.
– Develop “tailored support and protections” for the self- employed.
– Establish a new ‘dependent contractor’ employment status between employment and self-employment, with entitlements to basic rights, eg, sick pay.
– Give right to request a fixed-hours contract after 12 months for ‘zero hours’ and agency workers, not to be unreasonably refused.
– Shift the burden of proof in employment tribunals regarding employment status from individual to employer.
VAT – Guarantee rates will not rise. – To apply to private school fees.
– No increases otherwise.
– 5% VAT for electric vehicles.
– Other minor changes.
Excessive executive pay – “…improve incentives to attack the problem of excessive executive pay and rewards for failure.” – Levy on employers where an employee’s pay is deemed excessive. – “Require binding and public votes of board members on executive pay policies.”
Tax avoidance – Consolidate existing anti-evasion and avoidance measures and powers.
– All avoidance/evasion measures to raise £0.2bn annually by 2023/24.
– A ‘Fair Tax Programme” aimed at raising £6.2bn annually by 2023/24. – Introduce “…a General Anti-Avoidance Rule, setting a target for HM Revenue and Customs to reduce the tax gap”.
– Target £5.7m annually by 2024/25.
University fees – “…look at the interest rates on loan repayments with a view to reducing the burden of debt on students.” – Reintroduce maintenance grants for university students.
– Abolish university tuition fees.
– “Reinstate maintenance grants for the poorest students”.
State Pension – Keep triple lock, Winter Fuel Payments and free bus passes for all pensioners.
– Support the free TV licence for over-75s, expecting the BBC to pay for it.
– No comment on WASPI women.
– Keep triple lock, Winter Fuel Payments and free bus passes for all pensioners.
– Free TV licence for over-75s.
– Uprate State Pension of all British pensioners overseas.
– Restore pension credit and housing benefit eligibility for mixed-age couples.
– Introduce a £58bn scheme, phased over five years to compensate WASPI women for Pensions Act 2011 changes. Announced after manifesto published.
– Keep State Pension Age at 66 and review retirement ages for “physically arduous and stressful occupations”.
– Keep triple lock.
– Ensure WASPI women are “properly compensated … in line with the recommendations of the parliamentary ombudsman…”
Private pensions – “…address the ‘taper problem’ in doctors’ pensions…Within the first 30 days, hold an urgent review, working with [representative bodies] to solve the problem”.
– Review the issue of pension schemes operating net pay contributions for those with earnings between £10,000 and £12,500.
– Reintroduce the Pensions Schemes Bill 2019/20.
– “Stop people being auto-enrolled into rip-off schemes”.
– Seek to widen and expand access for more low-income and self-employed workers.
– Establish an independent Pensions’ Commission to recommend target levels for workplace pensions.
– No comment on tax reliefs.
– Review rules concerning pensions so that those in the gig economy do not lose out, and portability between roles is protected.
– No comment on tax reliefs.
Social care in England – Additional funding of £1bn a year for the term of the Parliament.
– “…build a cross-party consensus to bring forward an answer that solves the problem.”
– Guarantee that no one needing care has to sell their home to pay for it.
– Free personal care for “older people” would initially be provided, with the ambition to extend provision to all working-age adults.
– Create a £100,000 cap for the care costs in old age, with a lifetime cap on personal contributions.
– “Commission the development of a dedicated, progressive Health and Care Tax, offset by other tax reductions…”
Minimum wage – Increase the National Living Wage to 2/3rds of average earnings by 2024, currently forecast at £10.50 an hour.
– Widen National Living Wage eligibility to everyone over 21.
– “…rapidly introduce a Real Living Wage of at least £10 per hour for all workers aged 16 and over” – Set a 20% per cent higher minimum wage for people on zero-hour contracts.
– Consult on setting “a genuine Living Wage which would be paid in all central Government departments and their agencies with other public sector employers encouraged to do likewise.”
Fiscal rules – No borrowing to fund day-to-day spending (current budget);
– Limit average annual borrowing to 3% of GDP
– Reassess plans to keep debt under control, if debt interest reaches 6% of revenue
– Lower debt as proportion of GDP by end of the Parliament.
– Eliminate the current budget deficit by the end of the rolling 5-year Office for Budget Responsibility (OBR) forecast period
– Improve the strength of the Government’s balance sheet (Public Sector Net Worth) across the course of a Parliament
– Keep debt interest repayments below 10% of tax revenue.
– Fully fund day-to-day public spending (i.e. current budget)
– Borrow for capital spending
– Ensure overall national debt continues to decline as a percentage of GDP.

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