Policy Two

Tax Philosophy & Reform

Proposed Legislation for the Reorientation of the Fiscal System: Moving from distribution to accumulation, from complexity to clarity, and from stagnation to growth.

United Kingdom Parliament

Strategic Tax and Capital Formation Bill

A BILL TO simplify the structure of income taxation; to reform the taxation of capital gains to reward long-term holding; to stabilise corporation tax; to abolish Council Tax and replace it with a transaction-based system; to institute a moratorium on new taxes; and for purposes connected with the stimulation of national wealth creation.

BE IT ENACTED by the King's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Part 1: Principles of Fiscal Stability

The Fiscal Lock Mechanism

(1) The rates of Corporation Tax and Capital Gains Tax set out in this Act are hereby designated as Protected Strategic Rates.

(2) No Bill to increase a Protected Strategic Rate may be introduced into Parliament unless—

(a)a period of 10 years has elapsed since the passing of this Act; or

(b)the Office for Budget Responsibility certifies a State of Fiscal Emergency.

(3) Any increase prior to the expiration of the 10-year period requires a two-thirds majority in the House of Commons.

Simplification Duty

(1) The Chancellor of the Exchequer shall have a statutory duty to reduce the total word count of the Tax Code by 5% annually.

(2) Every tax relief, exemption, or allowance not explicitly renewed within 5 years of this Act shall automatically expire.

Part 2: Personal & Business Taxation

Income Tax Consolidation

(1) The existing bands of Income Tax are abolished and replaced with a Flat Structure.

(2) The Personal Allowance is set at £20,000, index-linked to inflation.

(3) All income above the Personal Allowance shall be taxed at a single Standard Rate, eliminating the distinction between Basic, Higher, and Additional rates.

Strategic Capital Gains Relief

(1) Capital Gains Tax (CGT) is reformed to incentivise long-term holding.

(2) The rate of CGT shall be determined by the holding period of the asset:

(a)Short Term (0-2 years): Taxed at Income Tax rates (Speculation Surcharge).

(b)Medium Term (2-5 years): Taxed at 15%.

(c)Long Term (5-10 years): Taxed at 10%.

(d)Strategic Term (10+ years): Taxed at 0%.

Full Expensing

(1) Expenditure incurred by a company on plant, machinery, digital infrastructure, and R&D shall be fully deductible from taxable profits in the year in which it is incurred.

(2) This provision is permanent and not subject to annual budgetary review.

Part 3: Property & Land Reform

Abolition of Council Tax

(1) The Local Government Finance Act 1992 is repealed. Council Tax is hereby abolished.

(2) No annual recurrent tax may be levied on the ownership of a primary residence.

Land Value Uplift Capture

(1) A new charge known as the State Infrastructure Levy (SIL) is established.

(2) SIL applies only where the value of land increases due to:

(a)The granting of planning permission; or

(b)The completion of state-funded infrastructure projects (rail, road, energy) within 1 mile of the property.

(3) The levy is payable only upon the realisation of the asset (sale or transfer), not on unrealised gains.

Property Ownership Transparency

(1) All legal entities owning land in the United Kingdom must declare a beneficial owner who is a natural person.

(2) Failure to declare beneficial ownership within 12 months of this Act renders the title voidable by the Crown.

Part 4: Final Provisions

Commencement

(1) Part 1 and Part 2 of this Act come into force on the first day of the next financial year.

(2) Part 3 (Property Reform) comes into force 12 months after Royal Assent to allow for the transition of local government funding.

Short Title

This Act may be cited as the Strategic Tax and Capital Formation Act 2026.