The NI and Dividend Hike by Boris
NI Increase, what people need to know. I don't tend to post very often, but having seen Boris Johnson describe his NI hike as necessary and fair, I had to take issue with that pack of blatant lies. I'm not taking issue with where the money is going, or why it's needed, I could do that on another thread. This is about who he is targeting, and how. Every employee now earning over £9500 will be paying an extra 10% NI. Yes, that's right. not a 1.25% increase as publicised. The increase for an employee is from 12% to 13.25%, so yes looks like a 1.25% hike. But look a little deeper. If you were paying £1000 in NI now, from April you will pay £1,104.16. That is an increase of just over 10%. That's the first point. Second point, is it fair? Well a while ago, I did an exercise to see how much tax burden a higher rate tax payer could end up with if they smoked and it's entirely possible for them to have a tax burden of 70%. So what about an average tax payer, 2.4 children doing average things? I would say a minimum of 33% total. However, If they smoke 20 a day, (did you know over 80% of the cost of a packet of cigarettes goes to the government) they could pay as much as 43%. That excludes all the sneaky stuff like speeding fines, bus lane fines etc, hospital parking charges etc. Is it fair for these people to see their total tax burden go up £250 per year? That's £500 per couple, regardless of income over £9500 through employment or self-employment. So if you are a company director, in a company making losses due to covid for example, your NI bill has just been jacked up from 13.8% to 15.05%. So if your NI bill was 10k, it's now £10,905. However, if your income is derived from say property, you could earn £250k and see NO increase to your tax burden, yes that's right, no increase in tax burden at all. So the self-employed carpenter, or the working mum working at tesco get's to pay another £250, but the property tycoon pays precisely nothing extra, not a penny. I find it impossible to call that anything like reasonable and fair. He may play the buffoon but he is anything but. He knows this is not reasonable or fair, and for that reason alone, in a couple of years time, if he is still in charge I will not be voting for him and his chums. Talking of which those chums of his who cowardly kept away, should hang their heads in shame. This is a tax on the poorest, excluding the richest, and there is no justification for it. Most people accept the need for change and to pay off the massive spending due to covid, but this is the least fair way to do it. There are literally dozens of better ways. This is indefensible and unjust. And I haven't even started on the dividend hike. Here at TSA we will just work all the harder to help our clients keep as much of their hard earned cash as they can. Sadly for the average employee who smokes, the first two days of the week they will effectively be working for the government and will start working for themselves sometime on Wednesday. Fair and reasonable Mr Johnson? My Arse!