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What the National Insurance change means for the average Barnet worker UK News

The government’s new National Insurance scheme means the average worker in Barnet will pay less a year from July, figures show.

Nearly 30 million British workers will see their taxes cut following Chancellor Rishi Sunak’s raising of the NI earnings threshold, despite a think tank saying more than a million Britons will be on the brink of death. “absolute poverty” due to the rising cost of living.

Figures from the Office for National Statistics show the median wage for full-time workers living in Barnet was £35,716 in 2021.

Currently, employees pay National Insurance 12% of their annual earnings above £9,568, meaning a worker on that salary would pay £3,138, or around £261 a month.

It was previously announced that NI rates would drop to 13.25% for a year from April 6 – to raise funds that will be earmarked for health and social services.

This means the average full-time Barnet worker will pay £27 more for a few months.

But in his spring statement, Mr Sunak announced that the earnings threshold will rise to £12,570 from July to mitigate the rising cost of living, meaning a Barnet worker earning the wages of media for the region will pay £71 less a year than they do now. – £3,067.

This is compared to £3,303 in the whole of London, where the median salary for full-time employees is £37,500.

Mr Sunak said it was ‘a £6 billion personal tax cut for 30 million people across the UK, a tax cut for employees of ‘worth over £330 a year’.

The Chancellor added that around 70% of workers would see their tax cut larger than the increase due in April.

Other measures unveiled include a 5p cut in fuel taxes and a pledge to cut the basic rate of income tax from 20p a pound to 19p in 2024.

However, the Resolution Foundation said the “significant but poorly targeted policy package” is not doing enough to help the families who have been hardest hit by the cost of living crisis.

It estimates that 1.3 million Britons are set to fall below the poverty line next year, including 500,000 children – the first time Britain has seen such a rise outside of a recession.

He also determined that only one in eight workers would actually see their tax bill drop by the end of the legislature.

Resolution Foundation chief executive Torsten Bell said: “Rishi Sunak has prioritized rebuilding his tax-cutting credentials over supporting low-to-middle income households who will be the most hard hit by the soaring cost of living, while allowing themselves fiscal flexibility in the years to come.

“It remains to be seen whether this will be sustainable in the face of huge revenue declines to come.”

Asked about this report, Mr Sunak told Beth Rigby Interviews that over the past 10 years the number of people living in poverty has decreased by around 1.3 million people.

As part of a series of measures introduced in his spring statement, Mr Sunak also announced that the Household Support Fund would be increased to £1billion from April ‘to do more to help our poorest households more vulnerable with rising costs”.

In October, £421m was distributed to allow councils to help vulnerable households in their area with essentials over the winter – with Barnet receiving £2,455,183 from the pot.

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This notice was published: 2022-03-30 11:51:01

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