Economy

Free markets

We believe in a free market economy where businesses are less constrained by government. This means reducing regulation, a simple taxation system and involves workers more in the running of companies. This also involves helping companies and workers to work together to improve businesses.

Sections:

  • UK wide.

The Minimum Wage Should be Increased. The minimum wage is the lowest amount you can be paid for an hour of work. The minimum wage should be £9 for people under 18 and £12 for people over 18. It should also be linked to inflation, so it keeps up with increasing or decreasing prices.

  • UK wide.

Employees Should Have the Right to Not Answer Work Related Emails After Work Ends. We believe that when work hours end, employees shouldn’t have to answer emails from their place of work unless it is extremely urgent or is agreed to when applying to the job. A similar system is already used in Germany to restrict business from interference in people’s personal life.

  • UK, Scotland and Northern Ireland.

Cut regulations. We support deregulation in areas such as product market regulation, building regulations on areas such as replacements in houses and in areas of regulation that are better controlled using collective bargaining.

  • Whole UK.

Elected Members on Company Boards. This would include the adoption of a dual board system as is used in Finland and Germany. It would have a management board which looks at the short-term operations of the company whilst the supervisory board would look at the long-term strategy of the company and will keep the management board in check. 50% of the supervisory board must be elected by all members of the company in a one person one vote secret ballot of everyone in the company that wishes to stand.

If companies don’t do this, then they will face a levy from the government making it economically beneficial to allow workers on their company boards. It would also only apply to companies on the stock market as is the case in Germany.

This is moving towards a system where the workforce knows what is going on inside their place of work and it can lead to easier resolution of conflicts between management and the workers without needing trade union action. Workers will also add to the company board as they are more likely to look at the long term with a possible risk of unemployment whereas shareholders can sell their shares more easily.

  • UK wide.

Collective Bargaining. This would involve the employer and a group of employees negotiating the conditions they are employed under rather than just being imposed by the employer. This would not affect minimum work standards guaranteed by the government or the minimum wage. It would however allow a way to negotiate the additional benefits that the job offers employees.

  • UK wide.

Strengthen the Competition and Markets Authority. Currently the UK has far too many monopolies and oligopolies in operation. To counter this, we feel the Competition and Markets Authority should be given more power to break up companies. Although no competition may seem initially beneficial to companies in the long term they stagnate and have less drive to make services better for their customers. A more competitive economy means more choice and lower prices for consumers.

  • UK wide.

Support Businesses Becoming Cooperatives. This includes worker cooperatives where the company is owned by its workers, where the customers own the business such as the co-op and partnerships where businesses are owned by their workers through stocks along with a say in the business such as the John Lewis Partnership. These types of companies give the workers more influence within the business and for models where employees own the business, greater incentive to work towards the business as a whole succeeding.

  • UK wide.

Allow Employees Six Months Leave to Start Up a Business. This would copy Sweden by allowing the employees of a business a six-month period of leave if they want to start up a new business. It would only be available if the new business is not in direct competition with the business they are currently in. In this time the position that person is in within the business can’t change. Just as it works in Sweden, it would be available to employees after they have spent six months in a business, businesses can only reject this leave if the person is absolutely vital to the functioning of the business and it would only apply to business of over 250 people.

  • UK wide.

End the backdated IR35 (loan charge) tax on individuals rather than businesses. The loan charge is being used to change tax on people who paid tax through another business rather than directly with their client. Whilst many of the businesses who have offered these loans have not been forced to pay money back, individuals have been. We disagree with backdated taxes and would end the loan charge on past taxation.

  • UK wide.

A National Sovereign Wealth Fund. We propose that ringfenced areas of income tax revenue, which include a pensions and social care fund, should be placed within a wider sovereign wealth fund. This would be with the aim to keep these savings from falling below the rate of inflation.

  • UK wide.

Give workers greater powers over working from home and flexible working. At the moment workers have a legal right to request to work from home or to work on a part time or flexible basis. We would add to this by making sure companies that deny these requests must prove they have no way to allow their workers to work from home. Rejections may be for reasons such as for work with time sensitive cases such as health work where it may not be possible to have flexible working or to work from home. We should also encourage working from home with the government helping to provide faster broadband as part of this and collective bargaining will also help workers to negotiate flexible hours with employees.

Taxation:

  • Scotland, Wales and UK wide.

Consolidated Income Tax. We support merging National Insurance, capital gains tax and dividends taxes into the existing income tax system. For the capital gains tax and dividends taxes these taxes would be paid at the same rate as other forms of income whilst National Insurance would simply be abolished with the revenue instead coming from general taxation. This would take gradually aligning the exemptions from each of these taxes and then eventually merging them.

Tax brackets would also be replaced with a ‘formula-based’ system as has been proposed by the IPPR. This would help to remove cliff edges between tax brackets and would vary depending on people’s total earnings. In Scotland and Wales this system should be partially devolved to their Parliaments replacing their existing tax raising powers.

  • Scotland, Wales and UK wide.

A Land Value Tax. This would be a twostep process which would introduce a Proportional Property Tax followed by a Land Value Tax. This would replace Stamp duty, business rates and Council Tax with one single tax. In Scotland Stamp Duty was replaced by the Land and Buildings Transaction Tax and in Wales it was replaced by the Land Transaction Tax.

The Proportional Property tax would be the same has proposed by Fairer Share as it would only be paid by owners, would place a flat tax rate on all properties of 0.48% with a rate of 0.96% on second homes, empty and non-resident owned homes and revaluations of all properties and land with annual revaluations each year. This would be neutral in terms of the revenue lost from council tax, stamp duty and business compared to the new revenue from a Proportional Property tax.

With the value of land estimates with a Proportional Property tax a Land Value Tax can then be introduced. This will be a single rate of 4% on all land which would be paid by landowners.

Both a Proportional Property Tax and a Land Value Tax are fairer for taxpayers and are more proportional meaning people with less land or property will pay less in tax. A Land Value Tax can also be used during recessions to increase spending without reducing productivity.

  • UK wide.

A Fairer VAT System. When a good or service is sold a business may have to pay VAT on it. On most goods VAT is 20% although some items have a reduced rate of 5% or on other items 0%. VAT is charged on the full price something is sold at. If a business produces a product or service that isn’t charged VAT, they can’t be refunded for purchases they make that incur VAT.

If a business has a turnover of less than £150,000, they can just pay a fixed amount to the government.

Currently maternity pads, mobility aids, sanitary products and products to end smoking are given a reduced rate of VAT but we would either push from them to be exempt from VAT if this is still under EU control or we will make them exempt if it is up to the UK government. If possible, we feel a business should only be charged VAT with turnover above £80,000 rather than £83,000.

  • UK wide.

The Top Level for Inheritance Tax Should be 50% and the Bottom Rate Will be 25%. Inheritance tax is taxation paid on someone’s estate (money, property and possessions) after they have died. Inheritance tax will be paid on any money over £200,000 regardless of the recipient unless it is a charity in which it would start at £300,000.

We would add in brackets:
Exempt below: £200,000
25%: £200,000 – £500,000
50% above: £500,000

  • UK wide.

Corporation Tax Will be Changed so Corporations Pay Tax on UK Based Profits. This tax will only be paid by corporations who employ above 500 people worldwide and/or make five million pounds per year.

  • Northern Ireland and UK wide.

Progressive Corporation Tax. Corporation tax should be raised to a maximum of 25% and smaller businesses should be exempt. This would mean that corporation tax in the UK would be below the G7 average, so it won’t be uncompetitive for the UK when compared to other large and advanced economies around the world.

  • Scotland, Wales and UK wide.

Tax Based Regulation. Tax based regulation is where the government places a tax on a harmful product and uses the revenue to reduce the tax on another product. This means that rather than a complete ban on something, it makes it more profitable for a business to follow government policy. This will be used in several areas. The first is existing policy which includes areas such as product market regulations where we would use tax-based regulation rather than standard regulations. The second is to promote a switch away from carbon usage, non-renewable energy sources and materials that damage the environment. The revenue from this would be used for environmentally friendly alternatives and research into alternatives. Finally, existing taxes such as Air Passenger Duty (which may be replaced by the Air Departure Tax in Scotland and the Landfill Disposals Tax already exists in Wales), Vehicle Excise Duty, the Landfill Tax along with the Scottish Landfill Tax and Hydrocarbon Oil Duty would all be merged into tax-based regulation with the revenue going back into environmentally friendly alternatives. The primary advantage of this system is that it is cost neutral both for the government and in terms of the amount of tax placed on products overall.

  • Wales, Scotland, Northern Ireland and England.

Tell People How their Taxes are Spent. This will be done using spreadsheets to show how the government spends taxes. It will be based off the system already used by some Nordic countries. This should be run by devolved parliaments in Scotland and Wales with the option for Northern Ireland to also introduce its own system should it vary corporation tax rates. England would have this system administered by the House of Commons.