Tory tax plans - promises to date
Updated on 10 November 2008
David Cameron paves the way for tax cuts in a speech today - but what have the Tories promised to date?
Freeze council tax for two years
The measure was unveiled at party conference this year. It's not quite as sweeping as it sounds - the cost of the freeze will be met jointly by central and local government, but town halls won't be forced to sign up to the scheme, so taxpayers will only feel the benefit if they live in an amenable area.
Nationwide council tax increases have been higher than inflation (at least, the lower CPI measure) over the past decade, although this can vary across the country - for example, (Tory-controlled) Hammersmith and Fulham cut council tax by 3 per cent this year.
Freezing VAT on small business for six months
Last month the Conservatives proposed allowing small and medium-sized enterprises to defer their VAT bills for up to six months.
The idea is to ease cashflow problems in the face of a credit crunch-related tightening of access to cheap overdrafts. Still, the tax would have to paid eventually.
Cut payroll taxes for small businesses
Employers' national insurance for businesses with fewer than five employees would be cut by 1p for at least six months, the Tories announced last month.
Corporation tax
The headline rate of corporation tax would drop by 3p, to 25 per cent, and the small companies' rate would drop by 2p to 22 per cent.
The first measure would be funded by reducing allowances; the second by removing investment allowances, which allow the vast majority of businesses to write off all their allowances except cars.
Hence Labour accuses the Tories of giving with one hand but taking away with the other - funding business tax cuts by cutting tax reliefs elsewhere.
Raise the inheritance tax threshold
Only millionaires would pay inheritance tax under a Tory government - the threshold of the death duty would be increased from £700,000 to £1mn. The policy was announced in the wake of rising house prices to great fanfare at last year's party conference.
Although the Tories reckon the policy would benefit a big swathe of society, the proportion of people who actually end up paying inheritance tax is far smaller.
The fair fuel stabiliser
When the price of oil goes up, the Tories would decrease fuel duty; when the price of oil goes down, they would increase the duty. The "fair fuel stabiliser" wouldn't keep the price of petrol at the pumps constant, but it is intended to reduce the impact of oil price fluctuations.
As Gordon Brown has enjoyed pointing out of late, the policy would in fact mean increased taxes for drivers at times of falling oil prices.
The Conservatives say the measure would pay for itself because of a corporation tax windfall when oil companies' profits increase. FactCheck has looked into it here.
Raise the stamp duty threshold
Increasing the level at which a property transaction becomes liable for stamp duty to £250,000 would take nine out of 10 first-time buyers out of the bracket.
The permanent stamp duty threshold is £125,000, although in September 2008 the government suspended stamp duty for a year on all properties worth up to £175,000.
Marriage and tax credits
Cameron has pledged to recognise marriage in the tax system - something which prompted Harry Potter author and former single mother JK Rowling to donate £1m to the Labour party in September. Exactly what the Tories would do isn't yet clear.
The party would also eliminate the "couple penalty" in the tax credit system - increasing the allowances for couples to the same amount given to two single people.
Green taxes
It's been a while since the Tory leader was photographed with huskies, but one of the party's longer-standing promises is to increase taxes on things that harm the environment.
This would not feather the government's nest: any increased revenue would go into a "family fund" and be offset by a tax decrease elsewhere, benefitting families.
Scrapping future car tax changes
The Conservatives oppose the government's plans to increase vehicle excise duty on the least environmentally friendly cars (include second-hand bangers) - due to start taking effect from spring 2009. The measure is due to bring in an extra £1.2bn over the first two years.
