In a series of videos on taxing multimillionaires, I am exploring the changes to the UK's tax system that are required to tackle the problems that growing inequality in the UK is creating.
Having explored the background to this issue in the first three videos in this series I am now exploring, video by video, the changes required to the many taxes in the UK that are biased towards the wealthy. In this video I look at National Insurance, which is a deeply unfair tax that has a significant bias that favours higher earners because under the existing rules of this tax they pay lower overall rates of national insurance contribution than those on average earnings in the UK. I do, of course, include suggestions for reform.
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I have always been puzzled by the fact that we have to pay income tax and a separate national insurance tax. I can’t see the point of doing it like that. Why can’t there just be one tax maybe at a higher rate?
Because international comparisons would then be hard
And because having two taxes has permitted political flexibility
Has the time come to reappraise both or the total elimination of NI and its replacement with another tax? Maybe ye
There are issues about ‘contributory’ benefits which I suggest should be more generous but it seems to me that there should only be a single ‘Income Tax’ and possibly an Employers NI
It is pretty remarkable when you think that one of the accusations the Buchanan Neo-lib Right makes of the Left in that it uses social policy to ‘bribe’ electors is actually the very same ploy the Tory party uses to gain the trust and backing of the rich (not to mention New Labour who toyed with this approach and paid for it dearly – as did we all after 2010).
NI is a tax that hammers the middle / professional classes.