Letter from the reader: “Increase in national insurance will affect young workers”
SIR – When political experts discuss how to increase additional government revenue to finance the rising cost of social care, there is near unanimity that the worst way forward would be to increase contributions to the social welfare system. national insurance.
There are several downsides to increasing the NIC, the most obvious being that it is regressive, hitting young workers harder than the rich and retirees.
Renaming the NIC as a âhealth and social care levyâ should not allow the government to muddy the waters. The Conservative manifesto’s cynical pledge not to raise taxes (nor the NIC) prompted the government to increase the NIC and rename it allows the government to claim that it was only breaking its pledge in “limited and specific ways” .
What the government is doing appears to be a cheap and temporary solution. What the social protection system needs is a major overhaul of its funding mechanism. A more innovative and principled government might have sought to introduce a property value tax or reintroduce higher income tax brackets.
In the UK, during the pandemic, the number of billionaires rose from 147 to 171, their total wealth increased by 20%. These figures argue in favor of greater taxation of wealth.
John Cole, Oakroyd Terrace, Baildon