A future UKIP government would raise the personal tax allowance to a minimum of £13,000, introduce a new 30% intermediate income tax rate and abolish inheritance tax, according to the party’s manifesto
UKIP says its hike in the personal allowance would take those on minimum wage out of tax altogether. The threshold for paying 40% tax would go up to £55,000, with the proposed 30% rate applying to earnings between £45,300 and £55,000.
The manifesto states: ‘The longer term aspiration of a UKIP government will be to create an income tax structure of a basic rate of 20%, an intermediate rate of 30%, and a top rate of 40%, meaning income taxes will be flatter and lower. In the longer term, we will aim to restore the personal allowance to those earning over £100,000 and make 40% the top rate of tax for all, as it used to be.’
If elected on 7 May, the party also plans to increase the transferable tax allowance for married couples to £1,500, and to introduce a flexible state pension window so people can still take a slightly lower state pension at age 65 even as the state pension age increases.
UKIP has pledged to fund a higher standard of independent advice available to all pensioners, compared to the recently introduced Pension Wise service. The budget for guidance will double in 2015/16 from £30m to £60m, and treble in the 2016/17 budget from£10m to £30m. It will be a criminal offence to cold call someone in respect of pension arrangements.
The manifesto also contains a pledge to ‘ensure big corporations pay their fair share of tax’, and states: ‘UKIP will not allow large companies to continue getting away with paying zero or negligible corporation tax in Britain. We will bring this unfairness to an end.’
However, the party does not spell out the measures it would adopt, beyond setting up a Treasury Commission to monitor the effectiveness of the new Diverted Profits Tax ‘and bring in any further measures necessary to prevent large multinational corporations using aggressive tax avoidance schemes.’
UKIP also says its commitment to taking the UK out of the EU would ‘end the practice of businesses paying tax in whichever EU or associated country they choose’.
Leaving the EU would result in significant changes to the VAT regime. Those cited in the manifesto include removing VAT from listed building repairs and sanitary products.
Party leader Nick Farrage is standing in the Thanet seat in Kent, while the party currently has two MPs as a result of by-elections in 2014.
