Conservatives play balancing game with National Insurance changes
Highest paid employers and employees will still be hit by the rises, which will not be totally cancelled out by Conservative plans
Highly paid staff and employers will still face bigger National Insurance
bills under the Conservatives, despite the party’s moves to blow Labour’s NI
increase out of the water.
The Conservative Manifesto, released
today set out plans to counter Labour’s 1p rise for workers and businesses.
But the highest paid and their employers will still be affected, because the
NI rises will still be in place, despite the threshold adjustments.
Conservative plans to raise the secondary threshold for employers NIC to £21
will not completely cancel out Labour’s 1p increase.
It will save employers up to £150 for every person they employ relative to
Labour’s plans, but this only will reduce the cost of Labour’s tax rise on
employers by “more than half” the Tories said in a briefing note.
For workers, the Conservatives said they would stop “this increase altogether
” for everyone earning under £35,000 by raising the primary threshold at which
people start paying NICs by £24 a week, and the Upper Earnings Limit by £29 a
week.
The Conservatives said everyone liable for Employees NICs earning between
£7,100 and £45,400 – 7 out of 10 working people – would be up to £150 better off
a year under their government, but the value tapered off as salaries got higher.
“Lower earners will get the greatest benefit as a percentage of their
earnings,” the briefing note added said. Nobody will be worse off.”
Further reading:
Tories
fuel likelihood of capital allowances reform