CPA Budget proposals.
CPA is committed to being responsible with the nations finances, caring for the poor and elderly and creating wealth where we can so in the long run we have more money to spend on priorities.
1) Borrowing. Keep targets to reduce borrowing to no more than £20bn per year by 2020.
2) Tax. Introduce new turnover tax on all companies at 5% with a turnover above £30,000 per year. This to be offset against corporation tax (tax on profits). This means the companies that will lose out will be those that do not pay corporation tax currently. It will give an even greater incentive for companies to locate in the UK and clamp down on tax avoidance.
3) Maintain corporation tax at 20% with no further reductions.
4) Increase level of stamp duty for property sales above £1.5million to 20% (currently 12%) for all property sales. This to be increased to 25% where the purchaser is not domiciled in the Uk for tax purposes or is a company. This level to operate on rolling sales over a 2 year period. So if a Buy to let property is purchased for £1 million this year and another for another £1 million next year, the second property will pay stamp duty at the marginal rate as if the first purchase had been £2 million. No mansion tax as Labour want.
5) Accept the 2% increase in NI for the self employed. We would increase in the 0% band of national insurance to bring it to the same as for income tax without loss of pension credits. Otherwise maintain the current tax and national insurance rates.
6) The chancellor took no action to stop people going to foodbanks. We say change the method of paying benefits so people who apply get the on application if there is a reasonable chance of success only to be repaid if they have lied on the application form. No benefit sanctions to apply unless a job offer is made or 3 job interviews have been missed. The test for disabled people and mentally ill to be changed so normally they won’t be taken off existing benefits. Where higher benefit rates are needed due to the extent of disability this will be provided.
7) The increased spending for social care of £2bn over 3 years is welcome though less than the £2bn per year which was called for. We would make this a priority.
8) Announce 3rd Heathrow runway to be scrapped. New airport to be built in the Thames Estuary instead with new rail links to be developed starting immediately.
9) Announce new investment bank for the UK to give grants and cheap loans to industry so our industry is ready to meet the new challenges of international trade. Initially the focus to be on shipbuilding and fishing where we will be seeking to enforce our international right to a 200 mile exclusion zone (or half way to the nearest country) as soon as article 50 is invoked. The size of the investment bank to be decided by how much increased revenue can be obtained from the turnover tax and increased stamp duty.
Please use this information if invited to comment to any media.
There has been a massive outcry this morning regarding the National Insuranace Increase for the self employed in the budget which I said yesterday we support. The point is that it is fair because the self employed are paying much less National Insurance and where in the past they got lower pensions they don't any more. However this does clearly break a Conservative Party manifesto pledge https://s3-eu-west-1.amazonaws.com/manifesto2015/ConservativeManifesto2015.pdf p.29"A Conservative Government will not increase the rates of VAT, Income Tax or National Insurance in the next Parliament". Therefore our positon has to be that they should not have done this until after the next General Election as no party should ever break a manifesto pledge. Our position however is we would not reverse it if we were in government but focus on increasing National Insurance thresholds for everyone instead.
I hope this is helpful.