By Timothy Adler on Small Business – Advice and Ideas for UK Small Businesses and SMEs
The government is pondering whether to increase national insurance contributions for both small business owners and employees to fund reform of social care.
The Treasury is debating whether to increase both employer and employee national insurance contributions by 1 percentage point – a penny in every pound both small business owners and their employees pay, according to the Times.
Employers currently pay 13.8 per cent as the main national insurance rate with employees paying 12 per cent of their earnings.
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Increasing national insurance contributions by 1 percentage point – for both employers and employees – would raise £10bn a year and would probably be dubbed a new “health and social care levy”.
Initially, it would be used to cut alarming NHS waiting lists for treatment, which are feared could rise from 5.3m to 13m patients.
It would then be spent to cap care costs, along the lines of a decade-old proposal to limit costs to £50,000, so families do not end up selling their homes and plug growing gaps in care treatment.
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