As we continue to gear up for the next election, it’s important to understand the key policies proposed by the major parties. 

This post provides an overview of the plans laid out by Labour, Liberal Democrats and the Conservatives, focusing on tax reforms and employment rights. Read on for how each party aims to address current challenges…

Labour

⚜ Cap the corporation tax at the current level of 25% for the entire parliament.

⚜ Ensure the minimum wage is a genuine living wage.

⚜ Modernise HMRC and change the law to tackle tax avoidance. They will increase registration and reporting requirements, strengthen HMRC’s powers, invest in new technology and build capacity within HMRC.

⚜ Banning ‘exploitative’ zero hours contracts, ending fire and rehire, introducing basic rights from day one to parental leave, sick pay and protection from unfair dismissal.

⚜ Introduce support for small businesses and the self-employed, which will include taking action on late payments to ensure small businesses and the self-employed are paid on time.

⚜ Reform the ‘broken’ Apprenticeships Levy. This will be replaced with a flexible Growth and Skills Levy, with Skills England consulting on eligible courses to ensure qualifications offer value for money.

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Liberal Democrats

On tax and the economy:

⚜  They want to give taxpayers real value for money, giving HMRC the resources it needs to properly tackle tax avoidance and evasion.

⚜  End retrospective tax changes such as the loan charge brought in by the Conservatives and review the Government’s off-payroll working IR35 reforms to ensure self-employed people are treated fairly.

⚜ Invest in people’s skills by replacing the broken apprenticeship levy with a broader and more flexible skills and training levy.

⚜ Establish a powerful new Worker Protection Enforcement Authority.

⚜ Modernise employment rights to make them fit for the age of the ‘gig economy’.

Conservative – A ‘clear plan’ for Britain

⚜ A further 2p tax cut off employee National Insurance, meaning it will have halved from 12% at the beginning of this year to 6% by April 2027.

⚜ No raise to the rate on income tax or VAT.

⚜ Tax cut to support the self-employed by abolishing the main rate of self-employed National Insurance entirely by the end of Parliament.

⚜ Tax cut for pensioners with the new Triple Lock Plus, guaranteeing that both the State Pension and the tax-free allowance for pensioners always rise with the highest of inflation.

⚜ A business rates support package worth £4.3 billion over the next five years to support small business.

⚜ Fund 100,000 high-quality apprenticeships for young people.