Covid-19: UK to increase social security contributions

British Prime Minister Boris Johnson in London, UK, July 14, 2021 (MATT DUNHAM / AP)

By renouncing his commitment not to raise taxes, the head of government is seriously violating the principles dear to the conservative party of the late Margaret Thatcher. Boris Johnson believes he has no choice in the face of the pandemic, the money must be re-injected into the free public health service. The national health service, blessed by the British, was no longer in good shape before the pandemic. Coronavirus is taking the final blow and borrowing on the financial markets would be “irresponsible” said the Minister of Finance after the recent increase in the Kingdom’s debt.

In front of British parliamentarians, Prime Minister Johnson announced Tuesday, September 7, a 1.25% increase in national insurance from April 2022. This increase in social contributions, which affects both employees and employers, should allow to raise 36 billion pounds (42 billion euros) over three years, enough to correct an inglorious situation. In the UK, more than five million people are currently on a waiting list for elective care, and if nothing is done, the government estimates that number could rise to thirteen million by the end of the year.

The British prime minister will also suspend the increase in public pensions by around 8% next year, limiting it to 2.5%, again breaking the commitment made in the scope of the 2019 legislative elections. taxes on dividends paid by companies to their shareholders. In addition to the urgent need to straighten out the health system, the announced fiscal measures also aim to fund support for elderly homes for people with few assets. All of this makes the UK the first country in Europe to use a fiscal bias to combat the effects of the pandemic.

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