I’ve just spent a couple of hours ploughing through the Labour, Conservative and Liberal Democrat election manifestos (perhaps I should get out more). Take a look at our summary to see how they might hit your pocket..
I find it hard to take the manifestos too seriously as it’s the norm to make vote seeking pledges now and neglect to implement them if elected. Nevertheless, there is quite a lot of specific detail that could affect your pocket, so I thought I’d compare each party’s pledge on a variety of money issues.
I’ve ignored areas such as education, health and defence as they all offer the usual pledges to improve standards and efficiency etc – although replacing Trident like for like is a moot point (Tories and Labour want to, LibDems don’t).
I’ve also ignored proposed spending cuts, as there’s currently so little tangible information trying to predict what will really happen is a waste of time. All you need to know is that there’ll be lots of them and the Tories would probably wield the axe faster than Labour.
And all three parties want to reduce our economy’s reliance on financial services and make us all greener.
Now to the money stuff, I’ve compared a number of key areas below (some of the Labour pledges have previously been announced and/or implemented):
| Area | Labour | Conservatives | Liberal Democrats |
|---|---|---|---|
| Income Tax | Will not raise 20%, 40% and 50% tax rates during next parliament (although no mention of personal allowances or new bands!). | - | Increase personal allowance to £10k, saving 20% taxpayer under 65 £705 and 40% taxpayer £1,410. |
| National Insurance | 1% increase already due April 2011 | Scrap the 1% increase. | Reverse the rise when affordable. |
| Inheritance Tax | Frozen nil rate band until 2014/15. | Raise nil rate band to £1m. | - |
| Capital Gains Tax | - | - | Tax at same rate as income. |
| Stamp Duty | No stamp duty for first time buyers up to £250k for 2 years. 5% rate for £1m+ properties from April 2011. | No stamp duty for first time buyers up to £250k forever. | - |
| VAT | Won't extend to food, kids clothes, books, papers and public transport fares. | - | - |
| Council Tax | No revaluation during next parliament. | Freeze for 2 years and no revaluation. | Higher tax on 2nd homes and replace with local income tax in future. |
| Property Tax | - | - | Annual 'mansion' tax of 1% on properties worth £2m+. |
| Tax Credits | No cuts and 'toddler credit' increasing child tax credit by £4 week for children aged 1 and 2. | Stop paying tax credits where annual family income exceeds £50k. | Restrict and target those that need them most. |
| State Pension Age | Raise from 65 to 68 by 2046. | Bring forward increase to 66. | - |
| State Pension Rises | Restore link to earnings from 2012 (also includes pension credit) | Restore link to earnings. | Immediately link to the higher of earnings and 2.5%. |
| Personal Pensions | - | Scrap effective compulsory annuity purchase at 75. | Scrap effective compulsory annuity purchase at 75. More flexibility to access money pre-retirement. |
| Pension Contributions | Cut tax relief to basic rate on income above £150k. | - | Only give basic rate tax relief. |
| Dividend Tax Credit | - | Allow pensions to reclaim when affordable. | - |
| Public Sector Pensions | Cuts, but no details. | Cap above £50k. | Review (likely cap or cuts). |
| Public Sector Pay | 1% cap on basic pay rises 2011-13. | - | Cap pay rises at £400 for 2 years initially. |
| Corporation Tax | - | Cut main rate from 28% to 25% and small co rate 21% to 20%. Simplify reliefs and allowances. | - |
| Unsecured Debt | Clamp down on interest and fees charged by doorstep lenders. | Ensure no-one is forced to sell their home to pay unsecured debts below £25k | Limit maximum interest rates on credit cards. |
| Charity Donations | - | - | Increase gift aid to 23% and stop higher rate tax relief. |
| Child Trust Funds | Protect and extra £100 for disabled children. | Scrap government contribution for all but poorest families. | Scrap government contributions. |
| Privatisation | £20 billion of asset sales planned by 2020. | - | - |
Of course, some of these pledges may never happen if the party is elected and others will likely turn out to be quite different. But I hope this gives you a flavour of what to expect and that it might help you when deciding to vote for – that’s if you haven’t already given up on politics altogether...if you have I can’t blame you.
Read this article at http://www.candidmoney.com/articles/article92.aspx
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