Rishi Sunak hints at further national insurance cuts in budget announcement

The government says the government wants to make life more comfortable for working citizens at the Scottish Tory summit.

Addressing Press at Scottish Tory Conference

Chancellor Rishi Sunak has dropped a strong hint that there could be additional cuts in national insurance rates in the upcoming budget announcement next week. 

Speaking to reporters at the Scottish Tory conference in Aberdeen, Sunak emphasized his commitment to easing the burden on working people across the UK, particularly in light of the Scottish National Party’s decision to raise income taxes for earners above £28,850 starting April.

Focus on Easing Financial Pressure

Sunak expressed concern over the SNP’s decision to increase taxes, stating, “Whilst the SNP is making life harder for hard-working people by putting their taxes up, I want to make life easier for people.” 

Also read: UK Chancellor’s tax cut plans derailed by reduced fiscal headroom

He highlighted the recent reduction in national insurance contributions (NICs) from 12% to 10% in January as a significant tax cut, benefiting workers across the UK.

Push for Further Tax Relief

The chancellor revealed that Scottish Secretary Alister Jack had been advocating for another NICs cut in the upcoming budget. Sunak echoed the sentiment, emphasizing the importance of rewarding hard work in society. 

He noted that Jack had pressed for national insurance cuts over income tax reductions, citing the positive impact on workers.

Speculation Surrounding Budget Announcement

Speculation has been rife about potential tax cuts in the spring budget, with Sunak’s comments indicating that further NICs reductions might be on the horizon. 

However, fiscal constraints have limited the scope for giveaways, prompting consideration of alternative measures such as abolishing non-dom status to offset unexpected tax rises.

Initiatives to Boost UK Economy

In a separate initiative, Chancellor Jeremy Hunt proposed measures to bolster British companies and revive the country’s stock market. 

One such proposal involves forcing pension funds to disclose their investments in UK businesses versus overseas ventures. 

The aim is to encourage investment in domestic enterprises and enhance returns for savers.

Promoting Investment in UK Businesses

Hunt emphasized the need for British pension funds to contribute more to the UK economy. 

By implementing disclosure requirements, the Treasury aims to facilitate informed decision-making among employers and drive investment in domestic businesses. 

The proposed policy seeks to align pension managers’ interests with securing favorable returns for savers, ultimately benefiting the UK economy as a whole.

As anticipation builds ahead of the budget announcement, Sunak’s remarks signal a potential shift towards further tax relief measures, with a focus on reducing national insurance rates to support hard-working individuals and stimulate economic growth.