Labour Manifesto with Pension Review and CGT In Focus

The Labour Party Election Manifesto was published on THursday 1^3th June at 11am.

What is a Mainifesto?

It provides details of economic policies and areas of law and taxation that a politcal party will cover in the coming parliamnetary period should they be elected to government.

It was widely rumoured that Labour would not reintroduce the Pensions Lifetime Allowance and there was no mention of this made in the manifesto.

Comment

What was inlcuded though was a commttment from the Labour Party for a full review of pensions and retirement planning.

We suspect this may mean

• Retaining the cap on Tax Free Cash lump sums of 25% of the old Lifetime Allowance (£1,073,100) i.e., a maximum tax free cash lump sum allowed of £268,275.
• Gradually, over the next 20,30 or 40 years, inflation will devlaue tax free cash if the cap is retained at £268,275.  An ever decreasing proportion of pension fund being tax free over the coming years.
• We suggest that an easy move woould be to renove higher rate (40%) and additional rate (45%) tax relief in pensio contributions.

Capital Gains Tax update 15/06/24

As an addition to yesterday’s story, we can also report that in Saturday, the Labout Party also confirmed that it woould not introduce capital gains taxes on or main homes (after the Conserrvatives has accused that Labout would).

Significantly though, no mention was made for investment property, buy to let and commercual property.  In fact, Labour have refiused to committ to no tax increases on Capital Gains Tax. 

We suspect that capital gains taxes will be increased from 18% (basic rate) and 28% (higher rate) taxes to normal income tax rates for capital gains taxes (as they used to be from 1988 to 2008).