Johnson says NI tax rise ‘unquestionably’ right thing for UK as tax hike comes in today
Boris Johnson has said the increase in National Insurance is “unquestionably the right thing for our country” on the day the tax hike comes into place.
Johnson said he has “absolutely no problem” with the tax hike as “we’ve got to give our doctors and our nurses the wherewithal, the funding” to deal with the 6m-person NHS backlog.
The 1.25 percentage point increase in National Insurance Contributions for employees and employers is expected to raise £12bn a year, which will go toward health and social care.
Revenues from the tax rise will predominantly go toward fixing the NHS backlog that has been caused by Covid-19, however after three years all the money will go toward fixing the UK’s social care system.
The increase in tax will be partially offset for workers by Rishi Sunak’s announcement last month to increase the National Insurance income threshold for employees.
“What we’re doing today is unquestionably the right thing for our country, unquestionably the right thing for the NHS. We’ve got here in the UK … backlogs, waiting lists of 6m people,” Johnson said.
“We’ve got to give our doctors and our nurses the wherewithal, the funding to deal with that. That’s why we’re taking the steps that we are today and I’ve got absolutely no problem with it.
“We’ve got to do the difficult things. We’ve got to take the big decisions, the right decisions for this county.”
Today’s National Insurance increase comes as Brits are facing a stark cost of living crisis, with the UK’s budgetary watchdog predicting that the highest fall in living standards since the 1950s will come this year.
The Institute for Fiscal Studies (IFS) think tank predicts that a mix of tax rises and inflation means the average British worker will be £400 worse off in 2022-23.
Most of the increases in living costs for households is coming through record energy price spikes, which began last year and will be exacerbated by disruption to Russian energy supplies.
The government will unveil its energy strategy tomorrow, which will outline how the UK can become more energy independent and keep prices down long-term.
The government has also given out some help for rising energy bills this year and Johnson today said “as we did during Covid, we will make sure we look after people to the best of our ability”.
However, he added: “Now we’ve got to be frank with people – there’s a limit to the amount of taxpayer money we can simply push towards trying to deal with global energy price spikes.
“But what we can do is make sure we fix some of the long-term problems. I think it was a great mistake not to invest long-term in nuclear power and I’m going to be saying a lot more about that tomorrow.”