THE CHANCELLOR's move to cut
Hunt slashed NI from 12 per cent to 10 per cent in autumn and cut another two percentage points yesterday.
The move will mean savings of £450 per year for the average earner and £754 per year for those on £50,270 or more. NI is charged on a band of earnings between £12,570 and £50,270.
However, that figure does not account for fiscal drag, where the thresholds at which higher rates of income tax kick in are frozen, and do not rise in line with inflation.
It calculated that if the government had made the bands inflation-linked and kept NI at 12 per cent, lower earners on £15,000 would save £390 per year. Those earning between £75,000 and £100,000 will pay £1,150 more as a result of the thresholds not being uprated with inflation, even with the tax cuts.
"This mixed picture for different earners will be exactly the kind of figures
(c) 2024 City A.M., source