New tax for social care

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PM raises taxes to fund NHS and social careBoris Johnson is going ahead with plans to increase National Insurance as the Government seeks to reduce soaring NHS waiting lists and tackle the social care crisis. The tax will increase from April 2022 by 1.25% for both workers and employers. The pensions triple lock has been abandoned, meaning retirees will no longer see their state pensions increase by average earnings this year. Additionally, income from share dividends will also see a 1.25% tax rate increase and working pensioners will pay national insurance for the first time. The self-employed will also pay the new levy. The Institute of Fiscal Studies warned it would increase the tax burden to its highest ever peacetime level while health experts warned that only £5.4bn of the total three-year £36bn package was earmarked for social care. Announcing his plans to the House of Commons, Mr Johnson admitted breaching his manifesto but said the Covid pandemic justified it. He also said he could not rule out further tax increases before the end of this parliament.

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