Taxbriefs Commentary Library

Taxbriefs Chancellors - 7 Gordon Brown 1997 -2007

Editorial Team, 11 Jan 2017


 

Gordon Brown became Chancellor on 2 May 1997, replacing Ken Clarke after Tony Blair scored the first of three successive electoral victories for the Labour Party.

Here is an overview of some of Mr Brown's key changes during his ten years as Chancellor:

  • Removal of the entitlement of pension schemes to reclaim the tax credits on UK dividends with immediate effect.
  • Cutting the tax credit on dividends to 10%, effective from April 1999.
  • Introduction of a windfall tax on privatised utilities to finance a welfare-to-work programme.
  • Tax relief for mortgage interest (on the first £30,000 of loan) was cut from the 15% set by Mr Clarke in 1993 to 10% from April 1998.
  • Introduction of ISAs in 1999.
  • Rate of tax relief on the married couples's allowance was cut from 15% to 10% from 1999.
  • Working family tax credits were announced, to be introduced from October 1999.
  • The higher rates of Stamp Duty were increased, with the top rate rising to 3%.
  • The basic rate of tax was cut by 1% to 23% from 2000/01.
  • Child tax credit was announced, to start in April 2001.
  • The flat rate VAT scheme was introduced to simplify record keeping.
  • What was to become stamp duty land tax was introduced, to take effect from November 2003.
  • The childcare voucher scheme worth up to £50 a week of tax-free care was announced, to start in 2005.
  • The corporation tax band was abolished.

Gordon Brown's Budgets changed the tax landscape of the UK, with basic rate income tax down 3% and corporation tax down 5%, while other taxes - notably stamp duty and NICs - became more important revenue-raisers. Over the decade, he greatly complicated the tax regime, even if one of the measures he is most remembered for originally went under the title of "pensions simplification". Brown's first Finance Act in 1997 was 105 pages, while the finale in 2007 was 309...However, that now looks almost restrained: "complification" has continued ever since, with George Osborne's last Finance Act running to 649 pages.

 


Print  | 
 |  Back to Library

Editorial Team

Content Developer

Taxbriefs

© Taxbriefs Limited 2012-2015
Registered in England No. 1247331
Registered Office: Wells Point, 79 Wells Street, London W1T 3QN

Centaur Media
Join us on LinkedIn