Tag : social care

£300 per year extra tax to fund social care

Over-50s could be hit for £300 a year in extra National Insurance to fund social care under Tory plans. Former Cabinet minister Damian Green, an influential backbencher, will argue in a speech today that the care system should adopt a model similar to the state pension. Shadow Chancellor John McDonnell said: “ Theresa May ’s top ally and close adviser has today let the cat out of the bag about Tory intentions to punish people with a tax on getting old.” The 1% National Insurance hike is among a range of measures Mr Green sets out to fill a £2.75billion funding gap. He suggests it as is a “last resort” to bring in £2.4billion. Another £350million could be generated by taxing the winter fuel allowance.

New tax on over-40’s being considered to fund social care

A new tax being considered by ministers as a way to fund social care could raise up to £15bn a year, according to a new report. The proposal would see a 2.5 per cent levy applied to the earnings of people over the age of 40, similar to the model used in Germany. The revenue generated by the new tax would go into a ring-fenced pot used to fund social care. Research carried out by pensions and risk consultancy Hymans Robertson suggested the German-style system could raise half of the money needed to plug the £30bn-a-year gap in social care funding the UK is facing by 2031.