🌹 Labour’s Budget Plans – Rumours – DAY 5 🌹

Continuing our daily discussion of the potential changes introduced by the Labour Budget, today we’re looking at more taxes.

• Increase the % rate payable or play around with the bands.

Our Comment:

• Self-explanatory.
• SDLT is already quite high.
• Chance of this happening – nprobably needs a bigger overhaul, so I’d say currently unlikely.

• Changes for Employers NI – not only do employees pay NI, but employers pay it on you, as their employees. Employers pay 13.8% NI on salaries over £9,100 p.a.
• Self-employed paying higher NI contributions than current
• Rumours around making Buy-to-Let Landlords pay NI on the rents they receive as income.

Our Comment:

• Increased employers NI doesn’t fit very well with the growth agenda but would be an easy political win because the view would be that it doesn’t directly affect “working people”.
• However, if the cost of employing people goes up, coupled with the strong wages rises in a tighter labour market, it can hit job creation and so could have an effect on the mobility of “working people” and trying to expand the workforce.
• Employers or Self-Employed NI increases – some increase reasonably likely, so would not be surprised.
• NI for BTL investors – never say never, but unlikely at this stage.

• Talk of reducing ISA allowances, changing tax free nature of gains and income, etc.
• Capping the amount you can hold in an ISA or capping the tax benefits.

Our Comment:

• Where does it sit on the list of priorities currently?
• Quite easy to enact, so chance of happening this time around – quite possible.

This post represents just one part of the potential changes the Labour Budget may introduce and our opinions. To download a PDF containing our full thoughts, please follow the below link.