“Sugar rush tax cuts will lead to sugar crash from hell”: MP hits out at budget’s 2p cut in national insurance
An MP has hit out at Jeremy Hunt’s 2p cut in national insurance, claiming the budget will do little to alleviate the financial situations of average earners.
The Chancellor is set to cut the main rate of national insurance contributions (NICs) paid by workers from 10 per cent to 8 per cent from April 6, which he said will benefit 27million workers.
According to the Treasury, the cut means an average worker on £35,400 will save more than £900 a year.
For those earning £20,000, the new cut is worth £148.60 a year, and for those earning £50,000 it is worth £748.60.
Bell Ribeiro-Addy, MP for Streatham, said: “For every £1 the Government spends on cutting NICs, 46p will go to the richest households. Just 3p will go to the poorest.
“Every penny of this is money has been taken away from school, hospital and council budgets, where it is so badly needed.
The Resolution Foundation said that anyone earning up to £19,000 will still be worse off and the biggest gainers are those earning £50,000.
Turning to funding for local authorities, Ms Ribeiro-Addy said cuts to council funding has already been slashed by more than half since the Conservative Government came to power in 2010.
She said: “Cuts to local government have had a particularly devastating impact on non-statutory services. I know that domestic abuse charities and centres will be really worried about their funding – especially in areas where councils face bankruptcy.
“These sugar rush tax cuts now will lead to the sugar crash from hell further down the line.”
A Treasury spokesman said: “Thanks to cuts to National Insurance since the Autumn, and to above inflation increase to tax thresholds since 2010, an employee on £20,000 will pay £934 less personal tax in 2028-29 compared to what they otherwise would have paid.
“Our record increases to the National Living Wage which, when combined with our cuts to National Insurance, means that from April, a full time NLW worker’s take home pay will be 35 per cent greater in real terms than it was in 2010.”
(Picture: Pexels/Alaur Rahman)
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