News & Events

Back to articles

General & People

How the upcoming UK general election could impact tax measures and an overview of the manifestos

24th June 2024

As the UK approaches the general election on 4th July, the potential changes to tax measures have become a hot topic. Both major political parties are keenly aware of the implications their tax policies will have on voters. Here, the Rowleys tax team share their predictions on how the general election might influence future tax legislation along with the key points from each of the major party’s manifestos and their overall view.

Inheritance Tax (IHT)

The budget in March did not address inheritance tax (IHT), leaving room for it to become a significant election issue. It’s anticipated that political parties may propose changes to entice voters:

Further potential changes to IHT could also include:

Capital Gains Tax (CGT)

CGT  is another area where significant changes are expected:

  1. Alignment with income tax rates: There is a likelihood that CGT rates will be aligned with income tax rates. This would mean higher CGT rates, particularly for higher earners.
  2. Removal of CGT uplift on inherited assets: The next government might remove the CGT uplift on the value of assets inherited, which currently allows for a reset of the asset’s value at death.

Making Tax Digital (MTD) for income tax

The investment in Making Tax Digital (MTD) for income tax has been substantial, making it unlikely that this initiative will be rolled back. Businesses and individuals should prepare for its continuation and possibly further developments.

R&D tax credits

R&D tax credits, which cost the UK government £6.6 billion in 2020/21, are expected to remain at their new rates. This includes the lower enhanced deduction for SMEs at 86%.

Income tax and personal allowance

Both main parties have pledged not to increase the rates of income tax, national insurance, corporation tax, or VAT. However, other measures could lead to higher tax payments include:

  1. Freezing of personal allowance and tax bands: The freezing of personal allowance and tax bands means that more individuals will fall into higher tax brackets as incomes rise.
  2. Potential reduction of additional rate tax threshold: The additional rate of tax (45%) could be applied to income over £100,000, as is currently the case in Scotland.
  3. Abolition of higher rate tax relief on pension contributions: The government may abolish higher rate tax relief on pension contributions.

Changes to non-domicile (non-dom) taxation

The Labour Party has indicated that the recent changes to the taxation of non-dom individuals do not go far enough. They propose taxing non-noms on worldwide income to fund NHS commitments.

National Insurance adjustments

While there is a pledge not to increase national insurance rates, the next government could consider charging national insurance on dividends paid by private companies, especially when paid alongside minimal salaries.

VAT changes

VAT could also see significant changes:

  1. VAT on private school fees: The Labour Party has proposed removing the VAT-exempt status of private schools, imposing a 20% VAT on their fees.
  2. Lower VAT registration threshold: The threshold for VAT registration could be lowered to £50,000, bringing more small businesses into the VAT system.

Key points from the party manifestos

Conservative manifesto


Labour manifesto


Liberal Democrat manifesto


Green’s manifesto

Our 2024 General Election Manifesto


Reform Manifesto

Our thoughts on the manifestos

Both the Conservative and Labour Parties have continued with the current policy of not raising the main rates of income tax, NI, Corporation Tax or VAT. Instead they are basing their policies on the economy growing over the lifetime of the next Government. However, if the growth targets are not met, and some independent commentators have expressed their doubts, the Government will have to consider either cutting public spending or increasing borrowing to maintain their pledges on not putting up tax rates.

An area of concern must be capital taxes and there could be significant changes to CGT and IHT following the general election. In addition the Labour Party will change the VAT status of private schools and charge VAT at 20%.

Whoever forms the Government on 5th July will have some tough decisions to make and it is likely that we will see a Budget Statement in mid-September once the Office of Budget Responsibility have commented on the new Chancellor’s proposals.


The upcoming UK general election is set to influence a range of tax measures. While headline rates of major taxes may remain unchanged, various other adjustments could significantly impact taxpayers. It is crucial for individuals and businesses to stay informed and prepared for these potential changes. Our tax team will share more insights as they become available.

At Rowleys, we remain committed to providing expert guidance and support to help you navigate any forthcoming  changes effectively. If you have any questions or need advice, please don’t hesitate to contact our friendly team.


Registered to carry on audit work in the UK; regulated for a range of investment business activities; and licensed to carry out the reserved legal activity of non-contentious probate in England and Wales by the Institute of Chartered Accountants in England and Wales.  Associate Directors of the firm are not Directors of The Rowleys Partnership Limited (registered no. 06125028) and are not subject to the obligations and responsibilities of Directors within Part 10 of the Companies Act 2006.  Any reference to an individual with the job title “Partner” refers to someone who is a Director of The Rowleys Partnership Limited and also a registered member of Rowleys Group LLP (registered no. OC306056)  A list of Directors and Members are available at Companies House. Details of our audit registration can be viewed at and details of our probate registration can be viewed at, both under reference number C001486455. View our Legal and Privacy PolicyView our Terms of Business