Tax at the party conferences and beyond

With a general election expected towards the end of 2024, the recent party conferences have indicated what tax policies may be taken forward into election campaigns. While there have been few definite announcements, rumours have also been circulating, especially in relation to inheritance tax (IHT). Whilst the Conservative Party forms the current Government, we have commented only briefly on the policies referenced at their conference as there was relatively little tax content.  We have, however, focused on the more detailed policies announced by the opposition as Labour policy. They are leading in polling and have won two seats from the Conservative party in the latest by-elections.

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Liz Hudson and Jane Duncan
Published: 23 Oct 2023 Updated: 23 Oct 2023
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The key message coming out of the conference was that while the Conservatives would like to cut taxes, the focus for now is on reducing inflation which in turn will boost disposable incomes. The indication was that there would be no tax cuts this year, but that, when possible, the preference would be tax cuts for businesses first, to drive growth in the economy.

The perennial rumours about IHT reform have resurfaced. While there are no firm indications that the Government plans to reduce it, it has been rumoured that the Chancellor may consider reducing the rate of IHT, or even abolishing IHT altogether.


Labour’s key message is that it will not use taxes to increase the burden on working people. At the conference, Labour’s National Policy Forum shared a paper that is likely to form the basis of their manifesto, and published a summary of this paper which includes the following tax policies:

Removal of “tax loopholes” for private schools

It is understood that the intention is to remove the VAT and business rates exemption for private schools. These proposals are causing significant uncertainty for schools trying to manage their operating expenses, while understanding the true cost of these changes.

Independent schools may therefore want to understand more about these potential changes and assess how they will be affected, while exploring tax efficiencies prior to a potential change in Government.

End the non dom tax regime, and put in place a system for “genuinely temporary residents”

This has been on Labour’s list for some time, although there is little detail as to exactly what the new system would involve. There have been various reports on the impact of such a change. While some conclude that this would result in significant increases in tax revenue, there is also concern that if individuals from overseas are put off moving to the UK, there will be an overall reduction in revenue. Individuals moving to the UK often contribute a huge amount to the UK economy, through paying employment taxes, national insurance, property taxes including SDLT, as well as substantial amounts of VAT through spending. After a period of time in the UK, inevitably they also pay other personal taxes in one form or another.

It had previously been thought that there would be a consultation period first, although Labour leader Sir Keir Starmer has now stated that the assumed revenue from ending the non dom regime will be used to reduce NHS waiting lists, which suggests more immediate action.

Other policies listed in the document include:

  • “End tax breaks for private equity bosses”, which we assume will consider the tax treatment of carried interest, and taxing this to income tax rather than CGT
  • Increase stamp duty land tax paid by foreign individuals, trusts and companies when they buy UK residential property
  • Support implementation of the OECD global minimum rate of corporation tax
  • Replace the business rates system with a business property tax system
  • Reform the windfall tax to remove “loopholes” for oil and gas companies
  • Tackle tax evasion, tax avoidance, and the use of offshore tax havens

Labour has also previously stated that it has no current plans for a wealth tax, nor to increase capital gains tax nor the top rate of income tax.

IHT rumours

It has also been reported in the media that Labour is considering removing or restricting IHT reliefs on agricultural and business property. .

If these reliefs are abolished, the application of a top rate of 40% IHT would in many cases mean the business would have to be sold on the death of the current owner to pay the tax bill.  This would have significant implications for the employees, investment and the stability of the business. Reassurance that the farm or business has a long-term future, as given by these reliefs, allows for longer term projects such as sustainability and environmental measures. Breaking up farms and businesses into smaller shareholdings could impede efficiencies, and potentially impact food production, employment and the sector’s contribution to the wider economy.

We have not yet seen any official announcement on these proposals, and the comments may have been a reaction to the rumours around the Conservatives removing IHT altogether.

An alternative policy option, which we have not seen suggested by the Party, would be to consider strengthening the ‘clawback’ elements of the legislation. If the farm or business is inherited and then sold within a specific time period, a deferred IHT charge could then come into force.

What next?

It is difficult to predict what changes may lie ahead and indeed when they may be announced, particularly with a potential change in Government ahead and following several years of disruption to the Government’s policy making schedule. The next general election must take place by January 2025, and an Autumn 2024 election is considered likely.

Tax policy-making schedule

Looking back, it was announced in 2016 that the Government would move to a single Autumn Budget each year, to promote certainty and stability, followed by a Spring Statement. The intention was that the Chancellor would not make significant tax or spending announcements at the Spring Statement, unless the economic circumstances required it, with any significant announcements being made at the Budget.

Autumn Statement / Budget

This timetable has been affected in recent years by various events including the pandemic, and in the short term we have an Autumn Statement scheduled for 22 November. We would therefore expect a Spring Budget in 2024.

Based on the Conservatives’ comments to date, we are not expecting any significant tax announcements at the Autumn Statement, although we may see some tinkering around the edges. This would leave the opportunity to announce tax cuts at a Spring Budget, or through manifesto pledges in advance of the general election, which could potentially include changes to the IHT rate or indeed more radical reform.

Understanding the impact

With potential IHT changes ahead at both ends of the spectrum, it is important to remember that IHT planning is often about wider succession planning and not just the tax itself. Despite the uncertainty ahead, if IHT is on your worry list, or if you may be affected by any of the potential changes discussed above, now is a good time to speak to a tax adviser. Please do get in touch if you would like to discuss any of the above.

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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.

Tax legislation

Tax legislation is that prevailing at the time, is subject to change without notice and depends on individual circumstances. You should always seek appropriate tax advice before making decisions. HMRC Tax Year 2023/24.