According to US media reports, on September 7, local time, British Prime Minister Boris Johnson announced the implementation of a tax increase plan to alleviate the UK’s medical and social security funding crisis. Johnson’s move was met with fierce opposition from inside and outside the Conservative Party. Critics believed that the Prime Minister’s move would flagrantly violate the promise of not increasing taxes on British workers during the 2019 election.
Johnson told members in the House of Commons that his Conservative government had made a “difficult but responsible” tax increase decision. Johnson planned to raise 36 billion pounds (500 One hundred million U.S. dollars). Previously, after 18 months of the COVID-19 pandemic, the NHS faced a backlog of millions of appointments and procedures.
Johnson said that social security reform can no longer “hesitate and delay.” He said: “The government has been avoiding this issue for decades.”
At present, the care funds for the elderly, sick and disabled adults in the UK are mainly borne by individuals, and people often have to run out of savings or sell houses to pay for the expenses. The government said that one in seven people paid a total of more than 100,000 pounds ($138,000), and the cost of elderly care was “catastrophic and often unpredictable.”
At the same time, funding for care for the poor who cannot afford to pay is placing more burdens on overwhelmed local authorities.
Johnson announced an increase in national insurance medical expenses for the working population and their employers by 1.25%, calling the move “responsible, necessary and fair.”
But the move broke Johnson’s promise not to raise personal taxes in the 2019 election. The new plan will take effect in April next year. This will make people with an annual salary of 21,000 pounds ($27,500) pay an extra 180 pounds ($248) in taxes each year. High-income earners with an annual salary of 67,000 pounds ($92,000) will pay more than three times the tax.
In addition, the tax on dividend income will also be increased by 1.25% to resolve disputes that the burden is only on the working population.
For politicians, breaching promises is nothing new, but the promises in the election manifesto of British political parties have long been considered binding on the government. Johnson’s new plan shocked many Conservative Party members.
William Hague, the former leader of the Conservative Party, stated that violating election promises will result in “losing credibility when making future election promises, blurring the difference between the philosophy of the Conservative Party and the Labor Party, recruiting new people for right-wing fringe parties, and giving the world Leave the impression that the UK is moving towards higher taxes.”
According to government plans, starting from 2023, people’s lifetime expenses for social care will be capped at 86,000 pounds ($118,500), and everyone with assets below 100,000 pounds ($138,000) will receive some state support.
Another American media analyzed on the 7th that Britain’s tax revenue is already relatively high, and it is not easy to further increase the tax burden of the people. What returns the public can get after the tax increase is the key to the problem. Therefore, the details of the new social security system will become the focus of attention. Johnson’s challenge is not to increase taxes, but to fail to provide truly valuable things in exchange for voters’ trust in him. This move will be very risky.
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