The political parties in Northern Ireland have published their respective manifestos ahead of next week’s UK General Election 2019. Tax relevant passages are summarised below.
Business tax (including VAT)
The Democratic Unionist Party (DUP) wants corporation tax rates kept under review to ensure they remain competitive against Northern Ireland’s main economic rivals. It is calling for an increase in the Employment Allowance for National Insurance payments to £4,000 and the introduction of time-limited capital allowances for businesses to support capital investment. The party wishes to abolish and replace the Apprenticeship Levy, calling it “a stealth tax that is not contributing to our local and national skills shortage and our productivity problem. It should be replaced by a private sector focused levy co-designed between employers and government with any resources it raises ring-fenced for skills. This will show a clear pathway between their contributions and the provision of apprenticeship services.”
The DUP also wants to zero rate sanitary products, zero rate for new Electric Vehicles for domestic use, reducing VAT rating for new Hybrid cars in addition to existing government support and increase the charge point grant up to £750. The party is calling for reform of the tax treatment of Conacre (rented) land to be undertaken so that there is a greater incentive for land owners to release land for productive farming.
The Ulster Unionist Party (UUP) says the productivity deficit, along with the obvious skills gap, must be closed in order to fully support the local economy, by taking proactive decisions such as opening up the Apprenticeship Levy to local employers. It would support a new concessionary five per cent VAT rate for the repair, maintenance and improvement of existing dwellings and a concessionary nine per cent VAT rate being applied to the hospitality sector, to negate the huge disadvantage compared to Ireland.
The Social Democratic and Labour Party (SDLP) supports devolution of corporation tax powers to Northern Ireland as an ‘absolutely vital step’ in growing private sector employment. It states that the impact of any cut must be competitive, especially against other similar regions, and should be focused on delivering growth in areas of high productivity and employment. SDLP would like to see a reduction on VAT on tourism and hospitality services.
The Alliance Party of Northern Ireland (Alliance) supports a wider range of VAT exemptions, including zero-rating both sanitary products and sunscreen, and lower rates for hospitality and housing renovation. It wants an international Financial Transactions Tax and, at a UK-wide level, retention of the bank levy. Alliance want the abolition of the Apprenticeship Levy as an ‘inefficient and distorting’ intervention to support skills investment, replacing it with greater direct government spending on skills programmes co-designed with the business community and other stakeholders.
Alliance supports new legislation that requires foreign companies to pay tax on those profits generated from within the UK, wants to review current tax relief schemes, introduce a General Anti-Avoidance Rule, set a target for HMRC to reduce the tax gap and reform rules that allow companies to avoid tax in both the UK and in developing countries. The party’s manifesto also supports opening up companies’ reports into their tax activities to the public to improve transparency, strengthen the enforcement of, and penalties for, tax evasion and create a register of beneficial interests for all international companies. The party supports efforts to ensure that the UK’s tax rules do not have a negative effect on developing countries. It also backs the creation of a register requiring the publication of company ownership information in the UK’s Overseas Territories and Crown Dependencies. This would ensure financial transparency and reduce the use of tax havens, says the Alliance.
Sinn Fein make no mention of business or personal tax in their manifesto.
The DUP want the personal tax allowance to rise in line with inflation each year. Over the parliamentary term, National Insurance allowances should be raised until they match personal tax allowances, says the party. And it wants to scrap the tapered pension relief annual allowance and review the annual allowance for defined benefit schemes.
The party also proposes to reduce the Insurance Premium Tax by one per cent every year of the parliamentary term, and to abolish Domestic Air Passenger Duty, claiming ‘it is a faux environmental tax that has a disproportionately negative impact on the peripheral parts of the UK’. Additionally the DUP wants to maintain the freeze in fuel duty.
The UUP also calls for the personal tax allowance to rise with inflation. The party wants to support the tourism industry and create a more level playing field for Northern Ireland airports by abolishing Air Passenger Duty.
The SDLP will continue to call for an end to Air Passenger Duty to allow airports in Northern Ireland to compete with their Southern counterparts and explore new routes to attract tourists. Additionally the party says: “From tackling tax evasion to speaking up for a humanitarian approach to refugees to opposing unnecessary conflicts, SDLP MPs will be there to speak up for people in the North and say ‘not in our name’.”
Alliance calls for a simplification of the payment and administration of income tax and national insurance, an increase to the tax-free allowance for income tax and an ‘evidence-based approach’ as to what the highest rate of tax should be. It supports taxes that tackle inequality, such as on very high-value properties or changes to inheritance tax. Alliance wants to ‘Green the taxation system’ to make polluters pay and to reward progress towards net zero. They would ban non-recyclable single-use plastics and replace them with accessible, affordable alternatives within three years, and extend deposit return schemes for food and drink containers throughout the UK.
DUP wants the freeze on benefits to end, with rises in line with inflation, and says the Working Tax Credit should increase by the rate of inflation plus 0.5 per cent. The two-child limit on universal credit should be raised to three and then four in this parliamentary term. It wants the pensions ‘triple lock’ protection and retaining winter fuel payments as a universal benefit.
The UUP complain that welfare reform was meant to have simplified the overall benefits system, but instead it has made the system more complicated and has driven even more people into real financial hardship. Fortunately individuals and families across Northern Ireland were shielded from some of the worst aspects as a result of the mitigation payments previously agreed to in 2015. Those measures are set to expire at the end of March 2020. The UUP calls for legislation at Westminster to extend mitigation measures on key issues such as the bedroom tax, especially as a result of the continuing mismatch in the local housing stock.
The SDLP say we should reject and refuse to use terms like ‘welfare and claimants’ and instead use ‘entitlements and people’. SDLP MPs will vote to scrap universal credit, the ‘bedroom tax’ and the two child limit policy and to end the benefits freeze. SDLP MPs in Westminster, in the absence of an Assembly, will press for an adequate mitigations package with a commitment to redistribute any underspend towards tackling poverty. They want to extend welfare mitigations for another four years. The party advocates for an increase in the Carer’s Allowance, bringing it into line with Job Seekers’ Allowance.
The SDLP will oppose the increase in state pension age and stand by the women born in the 1950s affected by the unfair hike in state pension age in their campaign for justice.
Alliance wants to see an ‘overhaul’ in the welfare system at Westminster to deliver support for all those who need it. It supports extending the welfare mitigations for Northern Ireland. It wants to see a repeal of ‘cruel’ UK-wide welfare measures such as the bedroom tax, the two-child limit and the six-month rule for terminally ill claimants, as well as the benefits cap. It wants to reduce the five-week wait for the first payment of universal credit and offer an interim payment and calls for an overhaul of bereavement benefits and ending outsourced medical assessments for welfare. Alliance suggests expanding free childcare provision to 30 hours per week.
Alliance wants to retain the triple lock on the state pension and ensuring an annual uplift linked to inflation and continuing to support automatic enrolment into workplace pensions. The party calls for transitional support to those women who have been affected by the decision to bring the date of the increase in the women’s retirement age forward, in line with the WASPI campaign.
DUP proposes increasing significantly the funding for the Small Business Research Initiative (SBRI). The manifesto says this has proved a considerable success, both in terms of supporting small business growth and the development of innovative products across a whole range of sectors. And the party wants an overhaul of corporate governance and audit to restore trust in business and reduce the likelihood of corporate collapses as well as systematic abuses of small businesses.
Although not contained within the manifesto, Sinn Féin previously said its policies on the economy were creating more well-paid jobs, promote regional balance, reduce carbon emissions, and raise productivity. The party wants to foster an open, rights-based society that a range of people want to live, work, and invest in; strengthen the all-Ireland economy and align Northern Ireland with the higher growth rate in Ireland; and prioritise rural areas for broadband investment.
Alliance calls for robust regulation of the gig economy, including zero-hour contracts and entitlements and protections for casual workers, support minimum wage equality for young people and a review into minimum and living wage standardisation across age groups and supports an increase statutory maternity pay (SMP) and Maternity Allowance to the same level as the minimum wage.
DUP will not vote for the Prime Minister’s Brexit agreement. These proposals, as currently framed, are not in Northern Ireland’s longer-term interests, and they are clearly without support within Unionism, the DUP says. There must be ‘unfettered’ access for Northern Ireland to and from the Great Britain market. The customs and consent arrangements must be revisited, too. The ‘one-sided approval mechanism for the Assembly takes no account of power sharing’. The Manifesto goes on to say the East-West checks as proposed would lead to excessively bureaucratic burdens for trade between GB and Northern Ireland, and consequentially higher prices and less choice for consumers as GB businesses opt for ‘not available in Northern Ireland’. The DUP will work to secure a Free Trade Agreement with the EU in a post Brexit scenario but if this is not realised the party believes that the UK tariff schedule should ensure reciprocal tariffs are placed on all ‘agri food’ products which are imported from the EU. The DUP would also place a much more sustainable Tariff Rate Quota and Tariff Rate on all imports from the rest of the world to ensure UK farmers have a level playing field for competition.
The UUP’s manifesto opens with Brexit and says that there is no doubt that Boris Johnson’s deal would be disastrous for Northern Ireland and disastrous for the Union of Great Britain and Northern Ireland. That is why if the only choice now is to leave under his deal or remain, we choose remain, says the UUP. ‘We joined the EU as one, we leave as one, or we remain as one,’ it says.
SDLP is pro-Remain, even calling its manifesto Stop Brexit Stop Boris. The manifesto says: “The European Union has played a central role in our peace process, providing constitutional comfort and critical resource to stabilise our new society.” The SDLP pledges to vote to revoke Article 50 and support a People's Vote second referendum.
Sinn Fein opposes Brexit. The manifesto says the party will protect the Good Friday Agreement in any future Brexit deal. It calls for special status for Northern Ireland, with no unionist veto and that Northern Ireland should re-enter the EU automatically in the event of Irish unification.
Alliance believes Northern Ireland’s interests are best served within the EU. If a Leave Parliament seeks to pursue Brexit, then, in descending order of preference, they want: a People’s Vote with the option to remain in the EU; the whole UK to remain in the Single Market and Customs Union; a Special Deal for Northern Ireland. The Alliance believes that Brexit will also have a negative impact on the rate of economic growth and accordingly tax receipts. By contrast, stopping Brexit will provide a ‘Remain bonus’.