The government plans to increase National Insurance (NI) contributions to pay for welfare reforms and to clear the huge backlog in the NHS caused by the coronavirus pandemic.
However, a split appears to have formed between senior cabinet ministers over how much NI to increase, with suggestions that it could be as high as 2%.
Any tax hike would be in violation of the 2019 Tory Manifesto, which includes a personal “guarantee” from Boris Johnson not to increase income tax, sales tax or social security.
And critics argue that it would disproportionately affect younger and lower-income workers, while retirees would not pay extra.
In 2019, The Times reported that one in five people ages 65 and over has a total household budget of more than £ 1 million – and their accumulated net worth is £ 4.7 trillion.
Conservative MP Marcus Fysh said he was “concerned about the government’s apparent direction of travel” and warned of a “socialist approach to welfare”.
“I don’t think it’s conservative to punish working-age people and their employers with higher taxes on their employment when our manifesto doesn’t promise,” he wrote in the Sunday Telegraph.
A source close to Health Minister Sajid Javid this week strongly denied that he had pushed for social security to be increased up to 2%.
However, they did not deny that he had spoken out in favor of an increase of more than 1%, which Chancellor Rishi Sunak is said to have rejected.
The table below shows how much additional workers would pay now – and how much they would pay if increased by 1%.
Difference at 1%
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