Conservative manifesto 2019
The Conservative Party manifesto promises no increases to VAT, personal income tax rates or National Insurance, as it concentrates on measures to make the tax system simpler and tackle tax avoidance and evasion.
The Conservative Party manifesto promises no increases to VAT, personal income tax rates or National Insurance, as it concentrates on measures to make the tax system simpler and tackle tax avoidance and evasion. There are plans to review the business rates system and increase the R&D tax credit. Another significant proposal is to introduce a stamp duty surcharge on non-UK resident buyers.
Key policies include maintaining the corporation tax rate at 19%, increasing the tax credit rate for R&D to 13% and cutting business tax rates for small retail businesses and certain entertainment venues. Proposals to reform entrepreneurs’ relief are also significant.
- Maintain the corporation tax rate at 19%.
- Review and reform entrepreneur’s relief.
- Increase the employment allowance for small businesses.
- Guarantee no increase to VAT.
- Increase the tax credit rate for R&D from 12% to 13% and review the definition of R&D.
- Implement the digital services tax.
- Increase structures and buildings allowance by 1% and encourage investment in physical building and equipment.
- Maintain support for creative sector tax reliefs.
- Abolish VAT on sanitary products (following an exit from the EU).
- Reduce National Insurance contributions for employers if they employ ex-Service personnel.
- Conduct a fundamental review of the business rates system with aim of reducing business rates. Cutting business tax rates for small retail businesses and for local music venues, pubs and small cinemas, was specifically noted. Extending business rates relief for local and regional newspapers was also noted.
- Devolve responsibility for corporation tax to Northern Ireland and consider also devolving short-haul passenger duty to Northern Ireland.
- Local people to continue to have the final say on council tax, being able to veto excessive rates.
- Create up to ten freeports around the UK.
- Review alcohol duty to ensure the tax system is supporting British drink producers.
- Consider how the apprenticeship levy can be improved.
- Introduce a new levy, from 2022-23, to increase the proportion of recyclable plastics in packaging.
Key proposals include no increases to income tax, the introduction of a stamp duty surcharge for non-resident buyers and the increase of the National Insurance threshold to £9,500 in April 2020. Proposals to reform entrepreneurs’ relief are also significant.
- Guarantee no increase to income tax.
- Guarantee no increase to National Insurance.
- Raise the National Insurance threshold to £9,500 in April 2020, with the ultimate ambition being to raise the threshold to £12,500.
- Introduce a stamp duty surcharge on non-UK resident buyers.
- Review and reform entrepreneur’s relief.
- Conduct a comprehensive review of a loophole which means a number of workers earning between £10,000 and £12,500 on net pay pension schemes miss out on pension benefits.
- Tackle tax evasion and reduce opportunities for aggressive tax avoidance by setting out a new anti-tax avoidance and evasion law which will:
- Double the maximum prison term to 14 years for individuals convicted of the most egregious examples of tax fraud.
- Create a single, beefed-up Anti-Tax Evasion unit in HMRC that covers all duties and taxes, from individual errors to deliberate noncompliance.
- Consolidate existing anti-evasion and avoidance measures and powers.
- Introduce a new package of anti-evasion measures, including measures to end tax abuse in the construction sector, crack down on illicit tobacco packaging and further measures to avoid profit-shifting by multinational companies to avoid paying taxes.
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.
This article was previously published on Smith & Williamson prior to the launch of Evelyn Partners.