General Election 2019 – Tax 'hot potatoes'

In the run up to any General Election it is inevitable that the main parties trade blows on a range of topics covering the NHS, unemployment and the welfare system, amongst others. 

Tax is also a political football used to persuade and entice voters.  It has been no different in the run up to this Election, as we’ve had a few announcements already that could impact entrepreneurs and businesses in the future.

The below is written from an apolitical stance, prior to publication of the 2019 manifestos, but includes some of the announcements made so far:

• Corporation Tax - Boris Johnson has already announced that the planned reduction in CT (from 19% to 17% from April 2020) will be cancelled, and a change in Government is likely to lead to a change in the main rate of UK Corporation Tax.

• Entrepreneurs’ relief – There has been speculation recently that ER does not effectively encourage entrepreneurship and may be too generous.  When asked recently whether he will keep Entrepreneurs’ Relief, Boris Johnson said he will make “no more comment on fiscal commitments”, refusing to commit to the future of ER.  Under Labour ER could also come under the spotlight, even though it was introduced by a Labour Government, and when you add the economic uncertainty surrounding Brexit into the mix, perhaps the future of ER is at risk.  The message is “use it or lose it”.

• Businesses – Labour have promised to introduce a climate apprenticeship programme, and reform the Apprenticeship Levy. The Tories have pledged an increase in R&D Tax Credits and the Employment Allowance, as well as improvements to the Structures & Buildings capital allowance.  Whoever obtains or shares power, there will be changes afoot that will impact businesses. 

There will no doubt be more announcements to come leading up to December 12^th, particularly when the manifestos are published and scrutinised, and time will tell which pledges actually come to fruition in policy change.

Change can lead to opportunity, but when it comes to tax, change can also significantly impact taxpayers and the tax liabilities that they incur.   

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