Tag Archives: national insurance

The graph which shows why the Lib Dem policy of raising the personal allowance is the wrong priority

Here’s a graph which should make Lib Dems who continue to advocate increasing the personal allowance as an effective way to help low- and middle-income earners sit up and pay attention.

It’s from the Resolution Foundation’s report, Missing the target: tax cuts and low to middle income Britain, published yesterday.

What it shows is which households gain from the party’s policy to increase the threshold at which income tax is payable to £12,500 over the course of the next parliament. As you can see, those households which benefit most are at the wealthier end of the spectrum; the poorest 20% benefit least.

res fdn tax cuts lib dem graph 1

Posted in Op-eds | Also tagged , , and | 46 Comments

Opinion: If an NHS Tax is a step too far, let taxpayers make an optional “NHS Donation”

nhs sign lrgLiberal Democrats have committed to protecting the NHS Budget in the next Parliament. But over the next 6 years, we will need to fill a £30 billion deficit to maintain the level of quality we expect from our NHS. Social care faces a £7 billion shortfall.

There have been recent reports that senior party figures are looking at a hypothecated “NHS Tax”.

Posted in Op-eds | Also tagged | 23 Comments

Lib Dems pledge more tax cuts: after personal allowance raised to £12.5k will also increase National Insurance threshold

Danny Alexander by Paul WalterToday’s big announcement from the Lib Dems has been the “plan to cut your tax bill further”. Here’s how The Guardian reports it:

The Liberal Democrats are to burnish their credentials as the tax-cutting party for the low paid by floating the possibility of cutting national insurance contributions for anyone earning below £12,500 a year.

In a challenge to David Cameron, who is facing pressure from Tory MPs to pledge bold tax cuts as the economy grows, the Lib Dems will promise in their general election manifesto to raise the level at which workers start to pay national insurance contributions.

Posted in News | Also tagged , , and | 36 Comments

Opinion: Lib Dems should get behind renaming of National Insurance

Tory MP Ben Gummer is today introducing a 10-minute rule bill “to make provision for National Insurance to be known as Earnings Tax”. It’s a very simple renaming proposal. But branding is important, not least in politics. The Chancellor is “said to be attracted to the idea”, so if Danny Alexander and Nick Clegg were to support it, the change could make it into the Budget.

It’s well known that National Insurance is an extra income tax in all but name. As far back as 1994, Lib Dem policy was “to abolish national insurance contributions and create an integrated tax …

Posted in Op-eds | Also tagged and | 31 Comments

Opinion: Making allowances – 12 conclusions about the Personal Allowance policy

CentreForum today published ‘Making allowances’ – a paper all about the Lib Dems’ flagship policy of raising the income tax Personal Allowance. Here are some of my conclusions – some obvious, some more obscure – to help inform future tax cuts.

1) The costs are huge. The coalition’s Personal Allowance increases have cost £11bn, and the Lib Dems’ minimum wage tax target would cost at least the same again. With this combined total, we could (roughly) reduce VAT to 15%; scrap council tax or business rates; easily deliver quality universal childcare; or

Posted in Op-eds | Also tagged , and | 16 Comments

Opinion: Help me deliver a workers’ bonus

Nick Clegg has this week called for a further increase in the basic tax threshold of £500, which would cost around £1bn and put an extra £10 a week into peoples pockets. It is a good call but it’s not the best call.

National Insurance is in theory is a tax that is hypothecated to pay for our pensions, our unemployment benefits and other aspects of social security, but in reality all of our social benefits are subsidised out of general taxation. What it does however do economically is constrain the poorest paid in our society in …

Posted in Op-eds | Also tagged | 19 Comments

IFS verdict: Labour’s 10p tax idea “has no plausible economic justification”

institute-for-fiscal-studies-logo-370x229Ed Miliband’s announcement yesterday that Labour will re-introduce a 10p starting rate of income tax paid for through the introduction of Vince Cable’s mansion tax has received a tepid response from the Institute for Fiscal Studies. The IFS put out a note yesterday headed simply, Better options exist to help low earners than 10p tax rate:

A 10p tax rate would reduce taxes for those on low incomes and strengthen their work incentives. A far simpler and more sensible way of achieving these aims would be to spend the same

Posted in News | Also tagged , , , , , and | 12 Comments
Advert



Recent Comments

  • User AvatarPaul Walter 28th May - 10:53am
    Glenn "The BBC is a big entertainment company like Sony or NBC or Fox" We seem to be going round in circles. No it's not....
  • User AvatarJ Dunn 28th May - 10:50am
    There's an assumption that voters are acting irrationally, but in fact the opposite is true. It's now a given, that we're presently in a global...
  • User AvatarPaul Walter 28th May - 10:47am
    Glenn " ITV is a commercial Channel." I think the point is that we all pay for ITV when we buy goods or services advertised...
  • User AvatarPaul Walter 28th May - 10:43am
    Glenn "As opposed to a director general appointed by the government of the day . " The director general is appointed by the BBC Trust....
  • User AvatarGlenn 28th May - 10:24am
    Stuart The BBC is nothing like pavements or the NHS and ITV is a commercial Channel. The BBC is a big entertainment company like Sony...
  • User AvatarCatherine Smart 28th May - 10:06am
    On the same lines as bob & Max - work your ward/division: get Focuses out - but do lots of street letters on single, smaller,...