What will the UK 2017 election mean for personal taxation?
A summary of the parties' main proposals outlined in 2017 election manifestos relating to personal taxation. This includes an overview of key party promises on inheritance tax, income tax, national insurance contributions and self-employment rights.
Our summary is based on information available and analysed up to 30 May 2017. Please note we have imported terms and words from the manifestos and the economics of the proposals have not been assessed.
Increase income tax for the top 5% of earners to help fund public services
Lower the threshold for the 45p additional rate to £80,000
Reintroduce the 50p rate on earnings above £123,000
Guarantee no rises in income tax for those earning below £80,000 a year
Guarantee no increases in personal NICs
Reverse tax giveaways on CGT and IHT
Scrap the married persons’ tax allowance
Clamp down on bogus self-employment, this includes:
– Assume a worker is an employee unless the employer can prove otherwise
– Ban umbrella companies which create a false structure to limit employers’ tax liabilities and limit workers’ rights
Set up a dedicated commission to modernise the law around employment status
Increase the tax on private medical insurance premiums
Guarantee winter fuel allowance as universal benefit
Ensure those with the highest income and wealth are making a fair contribution
Increase immediately basic, higher and additional rates of income tax by 1%
Raise the employee NI threshold to the income tax threshold, while protecting low earners’ ability to accrue pension and benefit entitlements
Reform CGT and dividend tax relief
Refocus entrepreneurs’ relief
Reverse a number of the Conservatives’ unfair and unjustified tax cuts including:
– Reverse CGT cuts and CGT extended relief
– Reverse the marriage allowance and the raising of the IHT threshold
Establish a review to consider the introduction of a single rate of tax relief for pension contributions, which would be designed to be simpler and fairer and set more generously than the current 20% basic rate relief
Commission the development of a dedicated health and care tax, to replace the 1% income tax rise, possibly based on a reform of NICs
Modernise employment rights to make them fit for the age of the ‘gig’ economy
Scrap the bedroom tax
Ensure pensioners who pay tax at the higher rate of 40% are not eligible for the winter fuel payment
Introduce a legal regulated market for cannabis - this would raise the amount of tax collected by the government
Enable local authorities to levy up to 200% council tax on second homes and ‘buy to leave empty’ investments from overseas
Remove the requirement to hold local referenda for council tax changes
Raise the personal allowance to £13,500 by the next parliament
Raise the 40 percent income tax threshold to £55,000
When the economic conditions allow, restore the personal allowance to those earning over £100,000.
Raise the inheritance tax threshold to £500,000, per individual, transferable for a married couple or those in civil partnerships, so up to £1,000,000 in total. Eventually eliminating inheritance tax altogether.
Introduce a flexible state pension window
Abolish the bedroom tax
Maintain all pensioner benefits and the pensions Triple Lock.
No quarterly returns (potentially for Making Tax Digital) and no increase in Class 4 National Insurance Contributions