Update : Since this article was written the three major parties have released their election manifestos. You can read our breakdowns of the tax policies from Labour, Liberal Democrats and Conservatives as well as compare the effect on take-home pay using this 2017 General Election Comparison Calculator.
The General Election is now just under a month away and whilst we are still awaiting the publication of manifestos from each of the political parties there has been enough discussion on major issues likely to be included already.
We are focused on taxation and how each of the parties will be tailoring the tax system, rates, allowances and bands to their agendas. Once the full manifestos are released, which should be over coming week or so, we will update and provide a comparison of the effects of the intended changes.
So, for now here is what we know:
Leader Jeremy Corbyn has stated the intention of raising taxes on those earning over £80,000. Labour Chancellor John McDonnell will likely leave VAT alone but insert new bands of taxation for income tax and for national insurance. The 50 percent top rate of tax will be very likely to return too and this may even be adjusted to kick in earlier than the current £150,000. Inheritance taxes will also be adjusted to kick in earlier.
David Cameron pledged in his 2015 manifesto to not raise income tax and national insurance during his 5 year tenure. This was cut short when he resigned and Theresa May, now PM, has called the election and is already eyeing scrapping Cameron's promise. VAT will likely remain the same 20 percent in general as today but the self-employed are a certain target of raised national insurance. The policy to raise Class 4 NICs was scrapped earlier this year but may return in the new parliament.
Tim Farron's party are planning to raise billions toward helping the NHS. In order do this, Lib Dem 'Shadow Chancellor' Vince Cable has stated plans to raise the rate of income tax in every band by 1 pence.
Effectively this will mean basic rate is to be 21%, higher rate 41% and top rate 46%.