Businesses, the wealthy and all other members of society must behave responsibly and pay their taxes – although in a geographically mobile world, tax rates should not be set so high as to be self-defeating. We believe that intergenerational equity requires that the constraints of sound government finance are respected. There is nothing moral in leaving future generations with unmanageable debt. On the contrary, it is anti-social.
- Reduce income tax through the introduction of new 10p and 30p bands. The 10p band would be the initial rate of tax for earnings in excess of the personal allowance. The 30p band would be the initial rate of tax for earnings in excess of basic rate tax.
- The top rate of income tax shall be increased to 47%, although the SDP pledges that the combined income tax and national insurance burden shall never exceed 50% of an individual’s income.
- Finance income tax reductions through the imposition of a new luxury rate of VAT on a limited number of high value items.
- Introduce a zero rate of VAT on female sanitary products.
- Introduce a ‘turnover tax’ for multinationals who exceed a certain turnover in the UK but pay an inadequate level of tax.
- A new ‘luxury’ council tax band will be introduced on high value homes as well as an increased council levy on second homes.
- The planned reduction in corporation tax from 19% to 17% will be scrapped. Instead we will introduce significantly greater tax incentives to invest in R&D and plant and machinery.
- We will introduce a 2-year employer’s National Insurance premium for businesses employing foreign nationals directly from abroad to assist in the financing of new vocational training initiatives for UK nationals.
- The interest rate on outstanding student debt shall be limited to the level of the CPI measure of inflation.
- We shall abolish the basic rate income tax for the U-21’s as part of a wider package of reforms to offer a significantly better deal for those young people who choose not go to university.