Raymond Doherty 18 May 2017 03:20pm

Conservatives scrap tax increase pledge in manifesto

Theresa May promised not to raise VAT but reversed the party's previous pledge not to increase income tax and National Insurance
Caption: The party also says that no Brexit deal is better than a bad deal following the two-year negotiating period.

Speaking today at the launch of the Conservative Party manifesto in Halifax the prime minister also unveiled plans to legislate for tougher regulation of tax advisory firms, promising a "more proactive approach to transparency”.

The Serious Fraud Office (SFO) is also to be scrapped and incorporated into the National Crime Agency.

Central to her speech and the manifesto was Brexit, with the party again stating that no deal was better than a bad deal following the two-year negotiating period.

“The next five years are the most challenging that Britain has faced in my lifetime. Brexit will define us: our place in the world, our economic security and our future prosperity,” said May.

Of interest to business, a Conservative government would increase the levy on employers who hire skilled foreign workers from £1,000 to £2,000 a year. It would also put executive pay packages to annual votes by shareholders and force listed companies to publish pay ratios.

It promised to “toughen the visa requirements for students, to make sure that we maintain high standards” and pledged to increase the earnings thresholds for people wishing to sponsor migrants for family visas.

It confirmed that the corporation tax rate will be cut to 17% by 2020 and that business rates will be reformed, with more frequent revaluations.

The party pledged to improve HMRC's capabilities to clamp down on smuggling and reduce online VAT fraud.

The personal tax allowance will be increased to £12,500 while the higher tax rate threshold will rise to £50,000 by 2020. Furthermore, a new £23bn fund will be created to boost productivity.

The triple lock on pensions will be scrapped from 2020 and be replaced by a “double lock”, which will see pensions increase in line with earnings or inflation. There will also be tougher punishments for those caught mismanaging pension schemes.

May also said net migration into the UK is "still too high" and reaffirmed her target to cut it to the "tens of thousands" rather than hundreds of thousands.

The manifesto promised to balance the budget by 2025 and increase the National Living Wage to 60% of median earnings by 2020.