General Election 2024: Labour propose tax rises for non-doms, private schools and oil and gas companies

Launching the manifesto, Sir Keir Starmer emphasised wealth creation, saying the election was “an opportunity to begin the work of national renewal”. There were no major surprises in the manifesto with key policies already announced ahead of the campaign.

He set out five key national missions:

1) Kickstart economic growth to secure the highest sustained growth in the G7 – with good jobs and productivity growth in every part of the country making everyone, not just a few, better off.

2) Make Britain a clean energy superpower to cut bills, create jobs and deliver security with cheaper, zero-carbon electricity by 2030, accelerating to net zero.

3) Take back our streets by halving serious violent crime and raising confidence in the police and criminal justice system to its highest levels.

4) Break down barriers to opportunity by reforming our childcare and education systems, to make sure there is no class ceiling on the ambitions of young people in Britain.

5) Build an NHS fit for the future that is there when people need it; with fewer lives lost to the biggest killers; in a fairer Britain, where everyone lives well for longer.

Labour’s proposed tax changes –

REVENUE (2028-29)	£million
Revenue from closing further non-dom tax loopholes and investment in reducing tax avoidance	5,230
Revenue from applying VAT and business rates to private schools	1,510
Revenue from closing carried interest tax loophole	565
Revenue from increasing stamp duty on purchases of residential property by non-UK residents by 1%	40
Windfall tax on oil and gas giants	1,200
Total	8,550

NB. This does not include changes which are revenue neutral, such as replacing Business Rates.

Labour’s manifesto can be read here and the fiscal plan here.

Labour’s 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

• No increases to National Insurance or to the basic, higher or additional rates of income tax.
• Abolish non-dom status “once and for all” and replace it with a modern scheme for people genuinely in the country for a short period.
• End the use of offshore trusts to avoid inheritance tax so that everyone who makes their home here in the UK pays their taxes here.
• Labour argue that private equity is the only industry where performance-related pay is treated as capital gains and they pledge to close this loophole.

Business taxes

• Replace business rates with a new system to level the playing field between the high street and online giants.
• Close the loopholes in the windfall tax on oil and gas companies. Labour would extend the sunset clause in the Energy Profits Levy until the end of the next parliament and increase the rate of the levy by 3 percentage points. The party also plans to remove the investment allowances and retain the Energy Security Investment Mechanism.
• Cap corporation tax at the current level of 25 per cent (and “act if tax changes in other countries pose a risk to UK competitiveness”).
• Retain permanent full expensing for capital investment and the annual investment allowance for small businesses.
• Provide firms with greater clarity on what qualifies for allowances to improve business investment decisions.
• Publish a roadmap for business taxation for the next parliament.

Indirect taxes and duties

• End the VAT exemption and business rates relief for private schools.
• Fund additional planning officers by increasing the rate of the stamp duty surcharge paid by non-UK residents.
• Support the introduction of a carbon border adjustment mechanism.

Tax compliance and administration

• Modernise HMRC and change the law to tackle tax avoidance.
• Increase registration and reporting requirements, strengthen HMRC’s powers, invest in new technology and build capacity within HMRC.
• Focus on tax avoidance by large businesses and the wealthy to close the tax gap.
• Strengthen the role of the Office for Budget Responsibility - every fiscal event making significant changes to taxation or spending will be subject to an independent OBR forecast.
• Commitment to one major fiscal event a year.
• Introduce a new expanded fraud strategy to tackle the full range of threats and work with technology companies to stop their platforms being exploited by fraudsters.

Other business policies

• Scrap short funding cycles for key R&D institutions in favour of ten-year budgets that allow meaningful partnerships with industry.
• Introduce a new industrial strategy and work in partnership with industry to seize opportunities and remove barriers to growth.
• End short-term economic policy-making with the establishment of an Industrial Strategy Council.
• Create Open Banking and Open Finance to support innovation and growth in the sector.
• Develop a ten-year infrastructure strategy.
• Take action on late payments to ensure small businesses and the self-employed are paid on time, as well as improve guidance and remove barriers to exporting for small businesses.
• Reform of the British Business Bank and procurement rules to give small and medium-sized enterprises greater access to government contracts.

Benefits, Pensions and Employment policies

• Review childcare and early-years system.
• Review Universal Credit.
• Improve the quality of maths teaching across nurseries and primary schools.
• Establish a youth guarantee of access to training, an apprenticeship, or support to find work for all 18- to 21-year-olds.
• Create a flexible Growth and Skills Levy.
• Retain the triple lock for the state pension and adopt reforms to workplace pensions.
• Increase investment from pension funds in UK markets and adopt reforms to ensure that workplace pension schemes take advantage of consolidation and scale.
• Change the remit of the independent Low Pay Commission.
• Reform employment support.
• Implement ‘Labour’s Plan to Make Work Pay: Delivering a New Deal for Working People’ in full, including: banning zero hours contracts; ending fire and rehire; and introducing basic rights from day one to parental leave, sick pay, and protection from unfair dismissal.
• Create a Single Enforcement Body to ensure employment rights are upheld.
• Remove the age bands, so all adults are entitled to the same minimum wage.

Other measures

• Introduce a National Wealth Fund with a remit to support Labour’s growth and clean energy missions - capitalised with £7.3 billion over the course of the next parliament.
• Introduce a permanent mortgage guarantee scheme.
• No new licences to explore new fields to oil and gas companies.
• Tackle unregulated and unaffordable ground rent charges.
• Deepen devolution settlements for existing Combined Authorities.
• Give councils multi-year funding settlements and end competitive bidding.
• Restore decision-making over the allocation of structural funds to the representatives of Scotland, Wales, and Northern Ireland.
• Improve the UK’s trade and investment relationship with the EU by tearing down unnecessary barriers to trade
• Work with allies and international financial centres to tackle corruption and money laundering, including in Britain, Crown Dependencies, and in British Overseas Territories.
• Support implementation of the OECD global minimum rate of corporate taxation and backs international efforts to make sure multinational tech companies pay their fair share of tax.