After a couple of years of policy-lite speeches from the Prime Minister, this year’s speech to Conservative party conference was packed with new announcements.
Maintaining the lowest corporation tax in the G20
Companies are coming from all over the world to invest and create jobs here.
That’s not happened by accident.
It’s because they see a government rolling out the red carpet for them, cutting their red tape, cutting their taxes.
So here is a commitment: with the next Conservative Government – we will always have the most competitive corporate taxes in the G20…
…lower than Germany, lower than Japan, lower than the United States.
But George said something really important in that brilliant speech on Monday.
A message to those global companies:
We have cut your taxes – now you must pay what you owe.
This is a deft way for a Conservative leader to respond to Ed Miliband’s announcement last week that he’ll crack down on tax avoidance to partially fund the NHS. By reiterating that corporation tax will be kept low, Cameron can continue to level ‘same old Labour, tax-and-spend’ criticisms at the opposition while also claiming that he will be extracting more money from the people who owe the exchequer.
Raising the tax-free personal allowance from £10,500 to £12,500
That will take 1m more of the lowest paid workers out of income tax – and will give a tax cut to 30m more.
So with us, if you work 30 hours a week on minimum wage, you will pay no income tax at all. Nothing. Zero. Zilch.
Lower taxes for our hardworking people…
…that’s what I call a Britain that everyone is proud to call home.
This is significant as it is a counter to the perception of the Tories neglecting the working poor, a criticism that was bolstered by the Chancellor’s speech earlier this week. It is also an interesting sign of our strange political times: the PM seemed to be responding to Ukip’s idea of scrapping income tax on the minimum wage using a Lib Dem policy of raising the personal allowance. Neither party is happy with this policy grab.
Raising the 40p tax rate threshold from £41,900 to £50,000
The 40p tax rate was only supposed to be paid by the most well-off people in our country…
…but in the past couple of decades, far too many have been dragged into it: teachers, police officers.
So let me tell you this today.
I want to take action that’s long overdue, and bring back some fairness to tax.
With a Conservative government, we will raise the threshold at which people pay the 40p rate.
It’s currently £41,900…
…in the next Parliament we will raise it to £50,000.
There were big cheers in the audience for this announcement. It’s a significant give-away, which perhaps the PM sees as a way of wooing the so-called squeezed middle. However, it leaves him vulnerable to the usual criticism from his detractors that he gives tax cuts to the wealthy. After all, £42,000 is still a high salary, particularly to those outside London.
Ring-fencing the NHS budget
The next Conservative Government will protect the NHS budget and continue to invest more.
It’s very unlikely that Cameron would have put an end to the government’s protection of the health service budget, what with Labour using the fact that it’s the party most trusted with the NHS as an election dividing line. However, the delivery of this announcement was significant. It was an engaging emotional passage drawing on his personal experience with his late son, Ivan.
Scrapping the Human Rights Act
We do not require instruction on this from judges in Strasbourg.
So at long last, with a Conservative Government after the next election, this country will have a new British Bill of Rights…
…to be passed in our Parliament…
…rooted in our values…
…and as for Labour’s Human Rights Act?
We will scrap it, once and for all.
Here was some meat from Cameron for the more right-wing, eurosceptic wing of his party. Although the Human Rights Act is separate from the EU, there is a similar element of sticking two fingers up to the officials outside of Britain who have a level of influence over our laws. It’s really a reminder though of the PM being hamstrung in coalition, as replacing the Human Rights Act with a UK Bill of Rights was a pledge in the Conservatives’ 2010 manifesto.