Boris Johnson to Raise Taxes to Address Covid and Social Services Crisis

Boris Johnson to Raise Taxes to Address Covid and Social Services Crisis

British Prime Minister Boris Johnson walks out of Downing Street on August 18, 2021 in London, Britain.

Hannah McKay | Reuters

British Prime Minister Boris Johnson will announce on Tuesday his intention to raise taxes to improve the country’s healthcare and social protection system.

By raising the national insurance rate (income tax) to around 1.25%, the Johnson government aims to tackle the social care funding crisis and the National Health Service’s treatment waiting list, the latter having accelerated in a context of increasing pressure on health services. East. Covid pandemic19.

The rate hike could bring in more than £ 10 billion ($ 13.8 billion) per year.

Johnson is expected to announce the change in a statement in the House of Commons on Tuesday. Prime Minister’s spokesperson confirmed to Sky News Tuesday morning That cabinet ministers had approved the plans.

Under the UK National Insurance Scheme, workers and employers pay a tax that funds certain social protection programs such as state pensions, statutory sickness benefits and maternity benefits. People over the legal retirement age do not pay tax, effectively reducing their tax bill.

For workers earning between £ 797 and £ 4,189 per month, the National Insurance payment is 12% of their income. Additional income over £ 4,189 per month is taxed at 2%. These payments are in addition to income tax.

Meanwhile, UK newspaper The Sun reported on Tuesday that cabinet sources said the “most profitable” participants in the stock market would also be subject to a further tax hike, which the BBC said could take the form an increase in taxes on shareholders’ dividends. I will come

The government announced on Monday that the English NHS would receive a £ 5.4 billion cash injection over the next six months to help respond to the Covid-19 crisis. Of this funding, £ 1 billion will be used to reduce the treatment backlog created by the pandemic.

In August, an analysis by the Nuffield Trust found that around 1.2 million people in England waited more than six months to access essential NHS services such as cardiology and brain surgery.

welfare reform

The money generated by the high national insurance rate should also be funneled into the overhaul of social protection in England.

Sky News reported that the reforms would include a limit on the amount individuals pay for care over their lifetime, limiting the amount to £ 86,000, although this may not include the cost of accommodation in a care home nurses.

Currently, people in England have to pay for their own care if they have savings and assets over £ 23,350, which means social care is rarely funded by the state. According to Sky, that limit is set to rise to around £ 100,000 as part of the reforms.

With the long-awaited changes in the country’s social protection system, people are often forced to sell their homes to meet the costs of care.

In his first speech as Prime Minister in 2019, Johnson said his government would “sort out the social services crisis once and for all”, promising to “give the respect and protection every senior deserves”. They deserve.”

Feedback

However, the Prime Minister’s plans have come under criticism from some MPs in his own Conservative Party, many of whom claim he will break promises made by the party before being elected to form a majority government.

Ahead of the country’s last general election in 2019, Johnson promised in a Tory manifesto not to raise the rate of income tax, VAT or national insurance.

House of Commons Leader Jacob Rees-Mogg wrote in his Sunday Express column over the weekend that Johnson’s turnaround on taxes could cost the Conservatives votes. Drawing on the famous quote from former US President George HW Bush: “Read my lips: no new taxes,” Rees-Mogg argued that “voters remembered those words after President Bush them. forgot ”.

Business Secretary Quasi Quarteng, Business Secretary Liz Truss and Justice Secretary Robert Buckland are also said to be concerned about the plans, as are several Tory lawmakers who are not in Johnson’s cabinet, according to the Guardian. informed of.

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