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Government Announces Tax Rise to Support Social and Health Care

Picture of Written by: Liez Comendador
Written by: Liez Comendador
Picture of Reviewed by: Junaid Usman
Reviewed by: Junaid Usman
Tax Rise to Support Social and Health Care

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British Prime Minister Boris Johnson has revealed plans to increase taxes on employees and firms, to try to repair the health and social care system. This has angered some in his prevailing party by contravening an election promise. The public authority will request that workers and firms pay an extra 1.25% on their National Insurance to support the changes.

“I accept that this breaks a manifesto commitment, which is not something I do lightly, but a global pandemic was in no one’s manifesto,” said Johnson.

Johnson told administrators in the House of Commons that his Conservative government had made the “troublesome but capable” choice to increase taxes, in order to raise £36 billion. This is to be spent over three years on social care, and the overstretched National Health Service.
pay any more than £86,000 in care costs
The NHS faces an excess of millions of deferred arrangements and strategies following a year and a half of pressing pandemic factors.

“The new levies, which take effect in April, will raise £36 billion over three years.”

The main beneficiaries are people who need to exhaust their savings or offer their homes to pay for care. One in every seven individuals pays in excess of £100,000 for care, as per the public authority which calls the expense of care “calamitous and frequently flighty.” Social care financing and association is convoluted and differs all around the UK. Since the UK’s populace is maturing and people are altogether living longer, this issue will get increasingly difficult.
1.25% increase to National Insurance
For instance, polls suggest that in 20 years’ time, there will be 53,700 more older grown-ups living with extreme dementia in Wales, twice as many as now.

“Organizations firmly go against an ascent in national insurance commitments as it will be a drag anchor on jobs development at a totally significant time,”

English businesses have expressed severe disapproval of Prime Minister Boris Johnson’s arrangements to add more taxes to pay for the wellbeing and social care change, saying that the government have added to the weight on firms that have already been beaten down by COVID-19 pandemic, and that this would cost jobs.

“Firms have been pounded by a year and a half of Coronavirus related limitations and have developed gigantic tax troubles.”

The new tax would raise money but do little to the expensive and inefficient way care is delivered through a patchwork of largely private companies. 

References

​(n.d.). Retrieved from Telegraph: https://www.telegraph.co.uk/news/2021/09/07/tuesday-morning-uk-news-briefing-todays-top-headlines-telegraph/

Clarke, J. (n.d.). Retrieved from BBC News: https://www.bbc.com/news/live/uk-58473078

Hayward, W. (n.d.). What the UK government’s new social care and tax plans may mean for Wales. Retrieved from walesonline.co.uk: https://www.walesonline.co.uk/news/politics/what-uk-governments-new-social-21502533

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Junaid Usman

Apart from being a partner at Legend Financial, Junaid is an expert on Business Tax including business management advisory services which has proven in the growth of company. He is a promising advisor with an ideology; "Any business success depends on the level of objectivity it maintains."

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Fahad Lateef

Fahad is a Chartered Certified Accountant (ACCA), proficient in numeracy and impassioned with giving concise advice to a wide range of clients related to different industries. With an immense experience of over a decade, he has worked as an advisor on different projects run by audit giants like Deloitte and others. He is a firm believer in mutual growth and an established culture of embracing change.

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