So, the promise to workers was that tax would not go up. The problem is the “hole” is getting bigger and as a result money has to come in.
We all know workers can earn anything from apprentice rates to seven figures but Labour seem to have decided that workers don’t earn too much. Harder/better/luckier workers that earn too much over their reasonable provision must after all get anything extra based on something other than work.
Once you acknowledge that “average earning” workers are the only ones protected the dilemma is how do you raise monies from the higher ones without affecting the average.
Well, the latest idea is to raise income tax but decrease NIC by the same amount. As there is already an upper limit for NIC that won’t affect the “allowed” earnings according to Labour this means that for the bottom end people will have no net difference. Those non-working workers though will see the same netting off on the bottom end of earnings but a straight increase on the top end.
If we’re talking about 2% it doesn’t sound much but could be £20k for someone on £1m or £4k for a non-working worker that does say fixing people on the operating table for the NHS.
What about non-workers? Well landlords and company directors in receipt of dividends already don’t pay NIC so the offset won’t happen for them. They will just pay more.
Yes, even the landlords doing 60 hours a week and the company owners “working” every hour god sends.