Labour promised not to put up income tax, but instead put up National Insurance Employer and Employee contributions. Labour claim this is NOT income tax, but it is hard to see NI as anything else. NI is supposed to go towards hospitals and pension funds. But NI is just pooled with other forms of income tax and spent today. Despite paying NI all your life there is no guarantee that there will be a state pension for when you retire. Raising NI is in fact a TRIPLE tax. First there is Employer and Employee tax, and then there is the knock on stealth tax. My Council Tax increased dramatically because the Police and Council added the increased burden of paying their employer NI to my Council tax bill. Triple Whammy from Labour!
IR35 had decimated the independent IT industry. It effectively obstructs entrepreneurial individuals starting dynamic young IT companies. With 95% of billed income taxed at PAYE a small IT contract company is at a huge tax disadvantage. Small IT companies have to pay Employer and Employee NI tax, as director/employees they go no sick pay, no holidays, no training. By law they are required to file end of year returns often requiring an expensive accountant.
My tax bill as an IT Contractor jumped to around 55% of the total of my companies revenues. This is a massive tax burden. Combine this with a declining IT market and out sourcing to India, Labour have killed the independent IT contract market stone dead. Large IT companies benefit by supplying IT Consultants without incurring the 62% Tax that smaller independent companies now have to pay. Often these large IT companies pay less than 20% tax, and sometimes not at all as many are registered abroad.
The threshold for 40% income tax remains largely unchanged at around £33,000. Year by year inflation erodes the value of money yet the threshold remains constant dragging more and more people into the 40% tax bracket. £33,000 used to be a significant wage. £33,000 is now in danger of becoming the average salary. With more people in the 40% tax bracket that ore tax revenue for labour
Similarly house stamp duty remains at £250,000 even though this is nearly the average UK price of a house in the South. Once again by doing nothing Labour can claim no tax increase while dragging more people into the higher stamp duty net as house prices spiral. In real terms doing nothing is effectively an tax increase. Yet another one by Labour
Another example of a threshold of £250,000 being maintained to catch more people. With the average UK price of a home in the South rapidly approaching £250,000 nearly everybody will be affected by inheritance tax. Inheritance tax was supposed to tax the rich, but now under Labour the average household will pay inheritance tax. The real irony is that the rich employ clever accountants to exploit loopholes and set up trusts to avoid inheritance tax. While middle England gets hammered once again.