Conservative tax updates
The Conservative manifesto includes the following proposals in relation to taxation:
Corporation Tax
- Corporation tax to remain at 19% (shelving the proposed cut to 17%).
- Increase the tax credit rate to 13% (from 12%) and review the definition of R&D so that 'investments in cloud computing and data, which boost productivity and innovation, are also incentivised'.
Income Tax
- National Insurance threshold to be raised to £9,500 next year (April 2020). Ultimate ambition is to ensure that the first £12,500 earned is free of tax.
- No increase in income tax or national insurance.
- One-year employer NICs break for employers that hire people up to one year after they have left the armed forces.
Capital Gains Tax
- Review and reform Entrepreneurs' Relief.
Property
- Introduce a 3% Stamp Duty Land Tax surcharge for those buying property who are not UK tax residents. This will apply to companies as well as individuals.
Other
- Remove VAT from female sanitary products post Brexit.
- Implementation of the Digital Services Tax.
- Address the ‘taper problem’ in doctors’ pensions, which 'causes many to turn down extra shifts for fear of high tax bills' and to hold an 'urgent review' working with the British Medical Association and Academy of Medical Royal Colleges to solve the problem.
- Increase the Employment Allowance for small businesses from £3,000 to £4,000.
- Reduce business rates for retail businesses, as well as extending the discount to grassroots music venues, small cinemas and pubs.
- A review to improve support for the self-employed including improving their access to finance and credit, making the tax system easier to navigate.
Tax System
The Conservatives have pledged to create a single Anti-Tax Evasion unit in HMRC that covers all duties and taxes, from individual errors to deliberate non-compliance and to double the maximum prison term to 14 years for individuals convicted of the most serious examples of tax fraud. They also plan to 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.'
26 November 2019
Boris Johnson announces a 3% stamp duty surcharge for non-UK residents buying UK property.
Read the Telegraph's coverage on this news.
22 November 2019
Boris Johnson announces an increase in the National Insurance threshold. Workers will have to earn more than £9,500 following a Conservative post-election budget before they pay National Insurance contributions. It is proposed that this will increase to £12,500 but without a timeframe being outlined. Read the BBC's article on Boris Johnson's pledge.
21 November 2019
Boris Johnson announces that corporation tax will not fall to 17% in a conservative administration. The headline rate of 19%, one of the lowest in the EU, is of course but one element of the 'effective tax rate' which is also impacted by exemptions and reliefs such as R&D credits which the conservatives are proposing to increase.
19 November 2019
Boris Johnson to announce cuts to employer's National Insurance as part of a range of tax cuts to win over the business community. Read the Evening Standard's article on Boris Johnson's tax cuts pledge here.
19 November 2019