Eight new tax plans from the new UK prime minister, Boris Johnson. Number 5 is the most interesting for SME owners.
- Raise higher rate band to £80,000 to reduce income tax. It is unclear if the National Insurance Contributions thresholds might rise too. That would claw back some of the benefits meaning more income falls into the class 1 NICs12% band.
- Increase the threshold at which people start paying NIC to the personal allowance level. Historically this has been promised before however as income tax and NICs are the biggest tax raisers for the government this means that the chancellor might be forced to raise taxes in a different way in order to compensate.
- Raise the Stamp Duty Land Tax threshold to property costing £500,000. This depends on housing policy one aim of SDLT is to dampen rising prices.
- Reduce the top level of SDLT from 12% to 7%. This will only affect property purchases at the top end of the scale.
- Cut the rate of corporation tax. Its unclear by how much, however corporation tax is not a big revenue raiser anyway. The question is whether this would be applied to micro, small or medium sized companies.
- Raise the AIA threshold to significantly above £1m. This would not hold any appeal to most SMEs.
- Reverse Mrs May’s 11th hour milkshake tax.
- Review “sin” taxes on sugar, and possibly alcohol and tobacco.