National Insurance

[DonkeyRhubarb]

I was shocked to discover that over the past 9 years under Labour, the amount collected through National Insurance has increased at twice the rate of Income Tax.

http://www.hmrc.gov.uk/stats/tax_receipts/table1-2.pdf

Year...........Income Tax (£Bn)........National Insurance (£Bn)
2001/2...............108.............................63
2009/10..............134............................95
% increase..........24%.........................50%

Labour are already planning to put NIC up again next year.

If they get back in, I wonder how long it will be before NIC overtakes Income Tax?

[Sysman]

Not really a surprise. Don't you recall them increasing it by a headline rate of "one per cent"? In plain truth that was a rise of more like 10%.

For sure the rate went up by one per cent, from 10% to 11% (I can't be bothered looking up the exact figures at the moment), and the employers' contribution rate went up as well, but few look at that one.

[SueEllen]

I was shocked to discover that over the past 9 years under Labour, the amount collected through National Insurance has increased at twice the rate of Income Tax.

Why are you shocked?

NI != Income Tax

The Nu Labour government stated they wouldn't increase Income Tax for the majority so they have increased as many other taxes as possible to try and balance the books.

Oh and council tax is not a local tax.

Most money from your various local councils/authorities comes from central government coffers. The tiny proportion that you pay as council tax is just to ensure that you vote for the right party at local election time.

[VectraMan]

Contractors complaining about NI? The ironing is delicious.

[NotAllThere]

It'll be all those new jobs that Labour policies have created. More jobs = more tax take.

[Platypus]

and the employers' contribution rate went up as well, but few look at that one.

Well, bosses exploit the honest labour of their workers, so it's only fair that they should pay this additional tax.

(c) Tarquin.


EDIT: Sorry, not tax, social levy.

[TykeMerc]

Well, bosses exploit the honest labour of their workers, so it's only fair that they should pay this additional tax.

(c) Tarquin.


EDIT: Sorry, not tax, social levy.

I detect some sarcasm in that post.

Of course as we know if employers are paying more in the tax laughably called National Insurance then there's less money to pay their existing employees or hire additional ones. That will do a lot of good for the economic recovery!!!

[DonkeyRhubarb]

Contractors complaining about NI? The ironing is delicious.

NI doesn't affect me, and hasn't for several years, because I'm retired.

I knew it had gone up but was just surprised by how much.

I guess that's why they call it a stealth tax.

[Sysman]

I detect some sarcasm in that post.

I liked Vectraman's "ironing" myself

Of course as we know if employers are paying more in the tax laughably called National Insurance then there's less money to pay their existing employees or hire additional ones. That will do a lot of good for the economic recovery!!!

It's always been the same with Labour governments. They think that all businesses are awash with cash.

Which I suppose if you consider the cost overruns with government IT projects (an no doubt non-IT projects too), is true from their point of view.

P.S. Do you remember Selective Employment Tax (SET)?

Oh a delicious link from 1967:

The latest manifestation of socialistic drift is the Selective Employment Tax which is levied against wages to provide subsidies for export industries, a unique departure from the long-standing practice of taking from the rich to give to the poor. The alleged justification for this discriminating tax is that those who pay it produce only services, but those who receive it produce tangible products which add to our real wealth and can be exported.

Thus, we renew in the twentieth century the old mercantilist notion that some industries are better for the nation than others: and perhaps they are — if the nation is hopelessly committed to inflation. This latest step in Britain may serve as warning to other peoples dedicated to inflation as a way of life.

[AtW]

I knew it had gone up but was just surprised by how much.

Why are you so suprised about it given things like BN66 piss take? For every person who dodges taxes in a big way someone else have to pay the difference either via higher taxes or via higher borrowing or both.

Granted tax cheats ain't the main offender in this instance, however they make already bad situation even worse.

What's really suprising (or not) is how you use statistics for 09/10 clearly marked as forecasts - more importantly you are picking on last year in this list knowing full well that income tax will be depressed due to "the rich" not paying as much with NI broadly staying the same or even going down if you compare it with 07/08.

If you actually look at %-tage NI when compared to income tax you will see that it gone up from around 60% to 70%, in other words actual tax increases relative to income tax in NI are nowhere near the figures you claim.