General Election 2024: Conservatives propose cuts in National Insurance and stamp duty land tax

The big tax cuts in the Conservative manifesto are a further 2% off employee National Insurance (NI), cutting it to 6%, abolition of class 4 (self-employed) NI and a higher income tax personal allowance for pensioners. The party is also promising to move to a combined household income threshold of £120,000 for the child benefit charge, abolish stamp duty land tax (SDLT) for first time-buyers on properties worth up to £425,000 and introduce a two-year exemption for capital gains on sales of residential properties by landlords to their tenants.

Additionally the Conservatives have committed that they would not increase rates of income tax, VAT, corporation tax or capital gains tax. However they – like Labour – would continue with the freezes to the income tax personal allowance and other thresholds which are already baked into the government’s finances.

The costed tax changes (with anticipated revenues for 2029-30, the final year projected) are –

Tax cuts	2029-30 (£ million)
Employee NICs: halve	10,300
Self-employed NICs: abolish	2,600
Triple Lock Plus	2,400
HICBC: end the single-earner penalty	1,316
Stamp duty for first-time buyers: abolish	590
CGT on sales to tenants: suspend*	0
Total tax cuts	17,206
Tax increases
Tackling tax gap	6,000

* For two years only: £20 million in 2025-26 and 2026-27

The manifesto is available here and the Conservatives have published their costings here. A fuller list of tax and related proposals from the party is set out below.

Launching the manifesto at the Silverstone racetrack, the Prime Minister insisted that the country had turned a corner after challenges such as COVID and Russia’s invasion of Ukraine, and claimed that economic stability was returning and inflation had fallen back to normal.

Rishi Sunak framed the general election as a choice of “who is best suited to transform that groundwork into a stable future for you, your family, and our nation.”

The Conservative manifesto has four main themes:

• Support working people and secure a stronger economy which includes the cuts to NI mentioned above.
• Provide young people with a secure future, including committing to fund 100,000 high-quality apprenticeships.
• Safeguard borders and national security, promising to increase defence spending to 2.5% of GDP by 2030 and introduce a legal cap on migration.
• Strengthening communities including abolishing SDLT for most first-time buyers and continuing to invest in communities across Scotland, Wales and Northern Ireland.

Conservatives’ tax and related proposals

(NB. This section generally uses the party’s own wording, though in places text may have been abridged or truncated. All characterisations of proposals or suggestions of their impacts are the party’s own.)

Personal taxes and family taxation

• Cut another 2p off employee NI so that it would be halved to 6% by April 2027 - a total tax cut of £1,350 for the average worker on £35,000.
• Abolition of the main rate of NI contributions for the self-employed (Class 4). This will not affect their entitlement to the State Pension. This is a simplification which means that 93% of self-employed people – four million of them – will no longer pay self-employed National Insurance.
• Pledge not to increase capital gains tax or the rate of income tax.
• Move to a household basis for assessing income for child benefit. The party plans to set the combined household income at which a family will start losing child benefits at £120,000 and gradually remove it until household income reaches £160,000.
• Introduce the “Family Home Tax Guarantee” which entails not increasing the number of council tax bands, undertaking an expensive council tax revaluation or cutting council tax discounts.
• Maintain Private Residence Relief so people’s homes are protected from capital gains tax.
• Introduce a two-year temporary capital gains tax relief for landlords who sell to their existing tenants.

Business taxes

• Extend the ‘full expensing’ policy to leasing.
• Pledge not to increase corporation tax.
• Continue to ease the burden of business rates for high street, leisure and hospitality businesses by increasing the multiplier on distribution warehouses that support online shopping over time.
• Retain key tax incentives that encourage small businesses to grow, including the Enterprise Investment Scheme, Seed Enterprise Investment Scheme, Venture Capital Trusts, Business Asset Disposal Relief, Agricultural and Property Relief and Business Relief.
• Maintain R&D tax reliefs.
• Maintain windfall tax on oil and gas companies introduced in 2022 until 2028-29, while ensuring it ends when oil and gas prices fall below a threshold.
• Maintain the investment allowances that provide incentives to invest in the North Sea.
• Create more Freeports and Business Rates Retention zones and enable councils to retain all business rates growth within a defined zone for 25 years.
• Creative sector tax incentives to remain competitive.
• Scottish businesses will also continue to benefit from measures including tax reliefs for creative industries, support for small businesses and entrepreneurs and the Global Britian Investment Fund.

Pensioners

• Introduce the new ‘Triple Lock Plus’, guaranteeing that both the State Pension and the tax-free allowance for pensioners always rise with the highest of inflation, earnings or 2.5%.
• Increase the personal allowance for pensioners by introducing a new age-related personal allowance.
• Pledge not to introduce any new taxes on pensions, and maintain the 25% tax-free lump sum and tax relief on pension contributions at their marginal rate.
• Maintain all current pensioner benefits, including free bus passes, Winter Fuel Payments, free prescriptions and TV licences.

Indirect taxes and duties

• Permanently abolish SDLT for homes up to £425,000 for first-time buyers and introduce a new Help to Buy scheme.
• Cut the cost of net zero for consumers by taking a more pragmatic approach, guaranteeing no new green levies or charges while accelerating the rollout of renewables.
• Rule out any frequent flyer levy.
• Keep the VAT threshold under review and explore options to smooth the cliff edge at £90,000.
• Pledge not to increase the rate of VAT.
• Implement a new import carbon pricing mechanism by 2027.
• Stop road pricing: A Conservative Government will not introduce pay per mile road pricing and will ban Mayors and local councils from doing so
• Reverse the London Mayor’s ULEZ expansion.
• The party has pressed for the permanent removal of tariffs on Scotch whisky with the US government and would work to achieve a significant tariff reduction in India through free trade agreement discussions.
• Maintain Brexit Pubs Guarantee that means the duty on drinks on draught, such as beer and cider, will be less than in supermarkets.
• We will continue to develop a UK-wide Deposit Return Scheme, while working to minimise the impact on businesses and consumers.

Tax compliance

• Raise at least a further £6 billion a year from tackling tax avoidance and evasion by the end of the Parliament. (NB. The party’s costings document records this as ‘Tackling tax gap’ suggesting it is broader than just avoidance and evasion. It adds: “Key measures include hiring additional HMRC staff, investing in labour-saving technology such as AI, and focusing particularly on problem issues like umbrella companies and regulation of the tax advice market. This number is consistent with the Conservative government’s record on tackling tax avoidance and evasion. Since 2010, the OBR has scored £94.8 billion of revenue raisers through Tackling the Tax Gap measures at fiscal events, averaging £6.7 billion for each of the 14 years.”)

Benefits and other personal finances

• Maintain the National Living Wage in each year of the next Parliament at two-thirds of median earnings.
• Give working parents 30 hours of free childcare a week from when their child is nine months old to when they start school, saving eligible families an average of £6,900 per year.
• Deliver £12 billion a year of welfare savings by the end of the Parliament with measures including:
  • Reforming the disability benefits system to halt the unsustainable rise in claims
  • Tightening up how the benefits system assesses capability for work
  • Overhauling the fit note process so that people are not being signed off sick as a default
  • Tougher sanctions so people who refuse to take up suitable jobs after 12 months on benefits can have their cases closed and their benefits removed entirely
  • Accelerating the rollout of Universal Credit
  • Continuing to clamp down on fraud (including a new Fraud Bill to give DWP powers similar to that of HMRC, so we can treat benefit fraud like we do tax fraud with new powers to identify, investigate and pursue fraudsters).

Other business policies

• Improve access to finance for SMEs including through expanding Open Finance and by exploring the creation of Regional Mutual Banks.
• Lift the employee threshold for reporting requirements allowing more companies to be considered medium-sized.
• Continue backing Investment Zones across the country, giving areas £160 million to catalyse local growth and investment.
• Improve enforcement of the Prompt Payment Code.
• Increase public spending on R&D to £22 billlion a year (up from £20 billion this year).
• Fund 100,000 high-quality apprenticeships for young people, paid for by curbing the number of poor-quality university degrees that leave young people worse off.

Other measures

• We will ensure councils have the powers they need to manage the uncontrolled growth of holiday lets, which can cause nuisance to residents and a broader ‘hollowing out’ of communities.
• Extend the UK Shared Prosperity Fund for three years at the next Spending Review.
• Launch a Seaside Heritage Fund to support enhancements to seaside heritage, preserving and restoring coastal assets. As part of this, the Conservatives would promise to protect residents from excessive council tax rises by ensuring local people have the final say on council tax.
• Expand the Long-Term Plan for Towns, supporting a further nine towns in Scotland, Wales and Northern Ireland with £20 million endowments to make long-term improvements over 10 years.
• Seize the benefits of Brexit by signing further trade deals.