Rishi Sunak told to reverse National Insurance rise NOW and keep manifesto promise
Rishi Sunak grilled by Andrew Marr over National Insurance rise
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Ahead of the Autumn Budget in October, the Government announced National Insurance payments for employers and employees would be temporarily increased by 1.25 percent, costing Britons hundreds of additional pounds each year. This will come prior to a new 1.25 percent Health and Social Care levy being introduced. The hike in National Insurance payments will come into effect in April 2022 when the new tax year starts and will help deal with the social care crisis, as well as contributing to the under-pressure NHS.
But the move was met with fierce opposition as it breaks a key Conservative Party manifesto promise not to increase taxes.
Prime Minister Boris Johnson admitted at the time to breaking his manifesto promise but insisted he could not “shrink the challenge” of fixing the NHS.
But now a prominent Tory MP has called on Chancellor Mr Sunak to perform a dramatic u-turn on the issue.
Sir John Redwood tweeted: “Glad to read the Chancellor wants to be a tax cutter.
“He should start by reversing the planned National Insurance hike, and uphold all the Conservative manifesto tax promises.”
The comments from Sir John come with Mr Sunak showing signs of his determination to cut taxes ahead of the next general election in 2024 amid growing frustration among Tory MPs at the rising burden on the UK taxpayer.
The Chancellor has reportedly told Treasury officials to look at options for reducing the tax burden, which is set to rise to its highest level for 70 years.
Proposed measures could include a 2p cut in the basic rate of income tax and slashing the rate of VAT, according to The Times.
Treasury officials are also believed to be considering if there is the possibility of scrapping the 45p higher rate of income tax and to raise the threshold at which Inheritance Tax becomes payable.
This would all be part of a plan to cut taxes ahead of the next general election in two-and-a-half years’ time.
The move is still in the early stages, according to the PA news agency, and there are no certainties over whether any proposed cuts can be put forward because of the current strain on the public finances.
But it could be seen as an attempt from Mr Sunak to restore his reputation as a “low-tax Tory” after he faced a huge backlash over the decision to hike National Insurance.
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A Treasury spokesman said: “We keep the tax system under constant review. And as the Chancellor made clear at the Budget, by the end of this parliament we want taxes to be going down, not up.
“We do not comment on speculation about specific tax changes.”
Mr Sunak entered the Treasury with a well-known reputation as a Thatcherite but the raging Covid pandemic has forced him to pay out huge sums to support the economy and country as a whole.
It means he is now faced with the huge task of rebuilding the already under pressure public finances.
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