The main political party manifestos have now been published and CTG has been through them to assess the key points of relevance to charities on tax.

We are all watching with interest to see what happens on 4 July. We will be in contact with the incoming Government to make them aware of the tax issues facing the sector.

As always, we are keen to hear from you.  Please let us know of any issues of concern to you and how your charity is affected by them.

 

CONSERVATIVE

Taxation and the economy

• Complete the review of Gift Aid within the next Parliament.
• Keep the VAT threshold under review and explore options to smooth the cliff edge at £90,000.
• Cut employee National Insurance to 6% by April 2027.

Culture

• Continue to support museums and libraries across the country. “Government has the power to leverage philanthropy for good causes and cultural institutions. We will work with individuals, businesses, charities and other networks to find opportunities to unleash this even further.”

LABOUR

Taxation and the economy

• Labour’s fiscal rules will operate on the basis that the current budget moves into balance, so that day-to-day costs are met by revenues, and that debt must be falling as a share of the economy by the fifth year of the forecast: “Our fiscal rules are non-negotiable”.  “We will strengthen the role of the Office for Budget Responsibility. Every fiscal event making significant changes to taxation or spending will be subject to an independent OBR forecast.”
• “Labour will not increase taxes on working people, which is why we will not increase National Insurance, the basic, higher, or additional rates of Income Tax, or VAT.”
• “We will modernise HMRC and change the law to tackle tax avoidance. We will increase registration and reporting requirements, strengthen HMRC’s powers, invest in new technology and build capacity within HMRC.”
• “Labour will end the VAT exemption and business rates relief for private schools to invest in our state schools.”
• “Labour will also act to increase investment from pension funds in UK markets. We will adopt reforms to ensure that workplace pension schemes take advantage of consolidation and scale, to deliver better returns for UK savers and greater productive investment for UK PLC.”
• “We will also undertake a review of the pensions landscape to consider what further steps are needed to improve pension outcomes and increase investment in UK markets.”
• “We are committed to one major fiscal event a year, giving families and businesses due warning of tax and spending policies.”
• “We will publish a roadmap for business taxation for the next parliament which will allow businesses to plan investments with confidence.”
• “Labour will cap corporation tax at the current level of 25 per cent for the entire parliament.”

Business rates

• “The current business rates system disincentivises investment, creates uncertainty and places an undue burden on our high streets. In England, Labour will replace the business rates system, so we can raise the same revenue but in a fairer way. This new system will level the playing field between the high street and online giants, better incentivise investment, tackle empty properties and support entrepreneurship.”

Charities and the voluntary sector

We could find only two specific mentions of the voluntary sector/charities, in relation to working with ex-offenders and tackling child poverty.

LIBERAL DEMOCRATS

There was no specific mention of charities or the voluntary sector.

Taxation and the economy

• Ensure that all fiscal events are accompanied by independent forecasts from the Office for Budget Responsibility.
• When the public finances allow, cutting income tax by raising the tax-free personal allowance.
• Increasing the Digital Services Tax on social media firms and other tech giants from 2% to 6%.
• Reforming capital gains tax to close loopholes exploited by the super-wealthy.
• Review further education funding, including the option of exempting colleges from VAT.
• Cut VAT on public charging for electric vehicles to 5%.
• Remove the VAT exemptions for private, first-class and business-class flights.
• Remove VAT on children’s toothbrushes and toothpaste.

Property

• Abolish business rates and replace them with a Commercial Landowner Levy.

Culture, Media and Sport

• Maintaining free access to national museums and galleries.

Political reform

• Giving 16- and 17-year-olds the right to vote in UK general elections and referendums, and local elections in England.
• Extending the right to full participation in civic life, including the ability to stand for office or vote in UK, to all EU citizens with settled status and to anyone else who has lived in the UK for at least five years and has the right to stay permanently.
• Strengthening and expanding the lobbying register

GREEN PARTY

Voluntary Sector / Culture

• A £5bn investment to support community sports, arts and culture.
• Keeping local sports facilities, museums, theatres, libraries and art galleries open and thriving.
• An end to VAT on cultural activities, lowering the prices of everything from museum tickets to gigs in local pubs and making these more accessible.

Other tax measures

• A Wealth Tax of 1% annually on assets above £10 million and of 2% on assets above £1bn.
• Reform of Capital Gains Tax (CGT) to align the rates paid by taxpayers on income and taxable gains.
• Aligning the tax rates on investment income with the tax and National Insurance Contribution rates on employment income.
• Removing the Upper Earnings Limit that restricts the amount of National Insurance paid by high earners.