Rishi Sunak urged to shift burden of tax from work to wealth

theguardian.com:

Rishi Sunak is being urged by a leading centre-right thinktank to limit the impact of April’s controversial £12bn increase in national insurance contributions by shifting the burden of tax from work to wealth.

Highlighting disquiet in Tory ranks over the looming national insurance rise, a report from Bright Blue has called for higher taxes on capital, inheritance and rents as a way of making the system fairer.

The thinktank, set up to promote liberal conservatism, also said people who worked on after they reach the state pension age should pay national insurance rather than being exempt.

The report said Sunak’s new health and social care levy – designed to raise money to clear NHS backlogs and increase spending on care – was “surprising” for a Conservative government to bring in and the priority should be to make it less burdensome for employers.

“It cannot be abolished but it can be made much fairer. Any detrimental impact on workers and employers can be mitigated,” the report added.

Sunak and Boris Johnson have insisted in a joint Sunday Times article that the national insurance increase will go ahead in April as planned.

But the Labour party, a significant number of Tory MPs and business groups have all expressed strong opposition to what they see as a tax on jobs. The Institute of Directors has warned the 1.25% increase – payable by both employers and employees – will drive up the UK’s already soaring inflation rate by adding to costs.

Bright Blue said the Treasury should not pass up the opportunity to recalibrate the tax system so that it better rewarded work and recognised the impact wealth and inheritance was having on life outcomes. Sunak could mitigate the impact of the NI increase and reform the tax system by a series