Do something popular for a change! MP demands tax rise scrapped as momentum gathers

National Insurance rise will ‘support’ NHS says Coffey

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As momentum gathers for the cancellation of plans to increase National Insurance, MPs have warned Prime Minister Boris Johnson that prices will increase and add to an already miserable rising cost of living in the UK. Taking to Twitter to encourage the PM to think twice, John Redwood added to the growing concerns over the proposed rise.

He said: “Plenty of momentum amongst MPs and the press to cancel the National Insurance rise.

“Come on Government, do something popular for a change!

“I keep telling Ministers they are allowed to do good things.”

However, there were some adverse reactions to the MP for the Wokingham.

The Jacquerie said: “Why would it be a good thing?

“It would be like telling somebody you are going to punch them in the face (whilst claiming to be a pacifist) and then telling them you’ve changed your mind and won’t punch them in the face.

“Are you expecting manufactured gratitude from the public?”

Whilst James Graham said: “A good idea, instead we have to tax the rich corporations, offshore owned media companies.”

In terms of the risk of rising costs, many are worried that the increase will plunge the poorest deciles of the social ladder into further poverty.

The Commons Treasury Committee says the planned increase in April risks driving up inflation.

The 1.25 percentage point increase also applies to employers, who it is feared will seek to pass on the additional costs to consumers through higher prices.

With economists warning that inflation could hit seven percent this year, MPs note that the Bank of England may be required to raise interest rates again, in turn driving up mortgage costs for millions of homeowners.

In its formal report on the Budget last October, the committee also said that the Prime Minister’s attempt to drive up salaries risked compounding the problem and creating a “wage price spiral”.

The report also echoed suggestions by Paul Johnson, the director of the Institute for Fiscal Studies, who said earlier this week that there was now “fiscal room” for the Government to postpone the rise in National Insurance Contributions.

It said: “The Chancellor has stated his ambition to cut taxes before the end of the parliament.

“In October, there was little room for manoeuvre, but there has been positive news from the public finances since then.

“While further good news may help him achieve this ambition, significant risks remain, most notably from the impact of inflation.”

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Its findings are likely to ratchet up pressure on Mr Johnson to delay the £12billion a year increase, which is set to cost the average worker an extra £255-a-year.

Yet, there are signs that the rise will go ahead, with some actively encouraging the increase.

A cabinet minister has argued that the national insurance rise should go ahead as planned despite Tory rebels reportedly pushing for it to be scrapped as the price for their support of Mr Johnson’s leadership.

Thérèse Coffey, the Work and Pensions Secretary, said there were no “dissenting voices” in Government pushing for the increase to be ditched, or pushed back, ahead of its introduction on April 6.

New rules for unemployed workers receiving state benefits are due to come into force – cutting the time they can spend looking purely for work similar to their previous job from three months to four weeks.

Ms Coffey told LBC: “We know there are plenty of jobs and we have plenty of people who receive benefits every week while they are looking for work, and we’re intensifying our approach.”

She added: “There are over a million jobs to be filled and we’re going to help people get into those.”

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