Chancellor Rachel Reeves has been urged to cut National Insurance contributions
(NICs) and increase Income Tax to create a 'level playing field' and protect
workers' pay.
The Resolution Foundation said the Chancellor should make a 2p cut to NICs as
well as a 2p rise in Income Tax in the Autumn Budget.
The think tank said the move would help to address 'unfairness' in the tax
system.
Adam Corlett, Principal Economist at the Resolution Foundation, said:
'Significant tax rises will be needed for the Chancellor to send a clear signal
that the UK's public finances are under control.
'Any tax rises are likely to be painful but given the fallout from the recent
employer NICs rise, the Chancellor should do all she can to avoid loading
further pain onto workers' pay packets.
'She can do this by switching our tax base away from employee NICs and onto
Income Tax, which is paid by a far broader group in society. This should form
part of wider efforts to level the playing field on tax, such as ensuring that
lawyers and landlords face the same tax rates as their clients and tenants.
'These sensible reforms would raise revenue while doing the least possible harm
to workers and the wider economy. And by acting decisively, the Chancellor can
turn her full attention back onto securing stronger economic growth.'
Internet link: Resolution Foundation