An extra 125,000 people will have to pay National Insurance under Rishi Sunak’s current tax plans, new research has revealed.
Research compiled by the Liberal Democrats, using figures from the House of Commons library, suggest that employees face an extra £1.1bn hit through a “stealth tax” if Sunak does not increase the current threshold by the level of expected inflation.
Sunak will increase the income threshold at which people pay National Insurance by 3.1 per cent to £9,880 from next month.
This is despite the Bank of England expecting annual inflation growth to hit 7.5 per cent by April.
It has been speculated that Sunak may lift the threshold in Wednesday’s economic spring statement to ease the cost of living crisis.
Liberal Democrat Treasury spokesperson Christine Jardine urged the chancellor to act and to increase the threshold in line with expected inflation.
“Families are facing the worst squeeze in living standards in 50 years, but the Conservatives are clobbering people with yet more stealth taxes,” she said.
It comes as the government will increase National Insurance by 1.25 percentage points from next month in order to increase health and social care spending.