Middle income earners ‘to be hit hardest’ by national insurance rise
Earners of £100,000 a year could end up paying proportionately less in national insurance than those on middle incomes if a planned increase goes through in April, it has emerged.
Figures produced by the Tax Calculator UK website show those earning £100,000 a year will pay just 7% of their overall salary in national insurance contributions (NICs) – the same proportion of their income as someone on £20,000 a year.
The prime minister and the Treasury have come under intense pressure to scrap or at least postpone the £12bn increase in NICs – introduced to cover the shortfall in social care funding – as the cost of living crisis continues to escalate.
While the Treasury has repeatedly claimed the increase is “progressive”, figures published on Friday by the online tax calculator show that workers earning between £30,000 and £50,000 will be the hardest hit by far.
It calculates that someone earning £50,000 a year will pay £5,086 a year in NICs alone after April – a £505 increase – amounting to 10% of their gross salary.
While someone earning £100,000 a year is set to pay the highest national insurance bill – £7,008 a year (an increase of £1,130), the proportion of their pre-tax income paid in NICs will be just 7%. Those on £30,000 a year will pay 9% of their gross salary in NICs.
“The increase in national insurance will have a huge effect on workers’ earnings in 2022, especially given soaring energy bills and the fact that inflation is at its highest point in 30 years,” said a spokesperson from Tax Calculator UK.
“This data gives us a compelling insight into the fact that lower and average earners will be significantly more squeezed by the NICs hike than those at the very top.
“People earning some of the highest salaries in the
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