NI increase

[LegendaryReady]

Have I read it right? It's and extra 1.25% to be paid by staff plus an extra 1.25% by employers of working people to cover increased costs of care for elderly people and wealthy retired and other non working people won't be contributing at all...?

I ask because effectively then, that's a 1.25% cut to school budgets and those of all other public sector organisations.

Plus the working poor will be financing wealthy families passing on assets unencumbered.

Whilst it had to be funded, I would like to know what the government t are doing with the £350m or whatever per week they blatantly advertised on the side of the bus.
Also no mention of how much global companies have to pay. Nice little tax concessions for the rich and wealthy. Really concerned for the young people of this country, they cant easily leave now either!!

I would like to know what the government t are doing with the £350m or whatever per week they blatantly advertised on the side of the bus

Strictly speaking, that was the leave campaign, not the government. However, the answer is simple. They have given it to the NHS as promised.

Also no mention of how much global companies have to pay

This was a bugbear under Labour as well. The problem is that international agreements designed to avoid companies being taxed twice on the same profits are used by global enterprises to move profits around to countries with the lowest tax rates. There are limits to what they can do and HMRC need to do a better job, but the current government has not given any breaks to these companies. The other point I would make regarding global businesses is that the press often focusses on how much corporation tax they have paid compared to turnover, ignoring the fact that tax is payable on profits, not turnover.

This is the problem with the uk we want everything but don't want to pay for it .

It's a slippery slope if you start say the young shouldn't pay for the old in that cases should people without kids finances children education and health.

As for wealth I have tightened my belt and increased my pension contributions . But I think I'm going to stop the increase and take a big chunk out of my pension when I can.
Because what is the point if your responsible you are penalised by getting no help form the state. Where as if you make no provision for yourself the state pick up the bill what is the incentive to save and prepare .

It's an additional 1.25 percentage points on the existing NI, which is actually a 10% increase in the rate you currently pay. It's a carefully crafted way of hiding the truth.

@Mxflamingnoravera

It's an additional 1.25 percentage points on the existing NI, which is actually a 10% increase in the rate you currently pay. It's a carefully crafted way of hiding the truth.

It is the way NI and income tax changes are always reported, regardless of which direction they are going.

On the OP, this isn't a reduction of 1.25% in public sector budgets. It would only be that high if all their budget went on staff costs.

The poorest workers and those not working don't pay NI so won't be affected. This isn't about the wealthiest families passing on assets unencumbered. It reduces the impact of care costs for all families. Theresa May proposed financing care by taking it from people's estates after they died. Labour branded it a "dementia tax" and the proposal is believed to have played a significant role in the Tories poor performance in the 2017 general election.

I'm not keen on increasing NI but I'm not sure what the alternative is. Labour's proposal to tax landlords has the advantage of being popular (landlords having a poor image) but the disadvantage that, if implemented, it would probably reduce the availability of rental properties and increase rents. In the worst case scenario it could lead to a housing price crash. Even in the best case, it almost certainly wouldn't raise enough money.

This is the problem with the uk we want everything but don't want to pay for it

Not just in the UK. That's true of voters in many places. Voters generally want governments to spend more but they want someone else to pay.

@prh47bridge

On the OP, this isn't a reduction of 1.25% in public sector budgets. It would only be that high if all their budget went on staff costs.

The poorest workers and those not working don't pay NI so won't be affected. This isn't about the wealthiest families passing on assets unencumbered. It reduces the impact of care costs for all families. Theresa May proposed financing care by taking it from people's estates after they died. Labour branded it a "dementia tax" and the proposal is believed to have played a significant role in the Tories poor performance in the 2017 general election.

I'm not keen on increasing NI but I'm not sure what the alternative is. Labour's proposal to tax landlords has the advantage of being popular (landlords having a poor image) but the disadvantage that, if implemented, it would probably reduce the availability of rental properties and increase rents. In the worst case scenario it could lead to a housing price crash. Even in the best case, it almost certainly wouldn't raise enough money.

Not really as simple as that - the NI threshold is £184 a week so even poorly paid workers (albeit not the very badly paid part timers or low hours zero hours ones) will be paying the increase.

Also you conveniently left out the fact that lots of wealthy people can currently dodge NI altogether as dividend income carries no NI (although it will be subjected to the new 1.25% later, as will People over pension age stil working).

As for an alternative, here's a great one -

www.theguardian.com/news/2021/oct/25/millionaires-petition-rishi-sunak-to-introduce-wealth-tax

@prh47bridge

This is the problem with the uk we want everything but don't want to pay for it

Not just in the UK. That's true of voters in many places. Voters generally want governments to spend more but they want someone else to pay.

I don't mind paying my share - and I can better afford it than some lower paid workers, but Amazon and fucking Facebook etc need to stump up as well or fuck off.

The poorest workers and those not working don't pay NI so won't be affected

The earnings threshold for paying NI is £184 a week. Could you pay all your bills on and live on £185, £200 a week??!! It does hit the low paid workers. Massively disproportionately.

@Alessandra87

The poorest workers and those not working don't pay NI so won't be affected

The earnings threshold for paying NI is £184 a week. Could you pay all your bills on and live on £185, £200 a week??!! It does hit the low paid workers. Massively disproportionately.

I didn't say it won't hit low paid workers. I specifically said it won't hit the poorest workers as they don't pay NI.

If someone earns, say, £10,000 (i.e. just under £200 a week) they will pay £5 a year more NI, which is 0.05% of their income. Someone earning £50,000 will pay £505 more NI, which is 1.01% of their income. Are you, perhaps, thinking of the effect on disposable income when you talk about it hitting low paid workers "massively disproportionately"?

For what it is worth, this rise is expected to raise about £12 billion. Those earning £10k or less will contribute less than £5 million, so less than 0.04% of the total.

Also you conveniently left out the fact that lots of wealthy people can currently dodge NI

I didn't "conveniently" leave out anything. I was responding to the OP, specifically the claim that this is designed to take money from the working poor to finance wealthy families passing on their estate. The fact that some wealthy people pay no NI because they don't receive a salary simply didn't seem relevant to that particular point.

And for clarity, let me say again that I am not keen on this, particularly as any rise in NI can result in a loss of jobs, but I'm not sure what alternatives are available.