Boris Johnson defends National Insurance levy in Parliament
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Lord Lamont, who was a member of Thatcher’s Cabinet in the 1980s and served as Chancellor in Sir John Major’s government, said the global pandemic had left Mr Johnson with little choice but to break his manifesto pledge. Amid a row within the Tory party over the Government’s decision to introduce a new health and social care levy, the Conservative grandee said even the Iron Lady would have backed reducing debt over tax cuts.
“Extraordinary times call for difficult decisions – and it is just such a decision that has been taken by Boris Johnson,” he wrote in the Daily Mail.
“Indeed, I believe that it is one that as radical a prime minister as Margaret Thatcher would in the end have supported.
“She used to say that sound finance and cutting borrowing came first – before tax cuts.
“Make no mistake, as a lifelong Conservative, I believe the object of government is to keep taxes as low as possible and that money is most efficiently spent and most productively used when it is in the hands of the citizen and not the Government.
“But I also know from personal experience that you can’t always get what you want – and that sometimes you have to make unpalatable choices.”
The backing for the policy from Lord Lamont comes as somewhat of a coup for the Prime Minister, who had been grappling with Tory MPs quietly seething at the tax rise.
While his plan for a 1.25 percentage point increase in national insurance contributions easily passed through the Commons, a number of Conservatives abstained in the vote.
MPs voted by 319 to 248 in favour of the policy.
Five rebels voted against the tax hike, including former Cabinet Ministers Sir John Redwood and Esther McVey along with Sir Christopher Chope, Philip Davies and Neil Hudson.
In total 37 Conservatives did not vote, although not all would have deliberately abstained, as some would have had permission to be away from Westminster.
A significant number of backbench MPs are concerned the new levy means the tax burden is now at its highest level since World War Two.
Under the new levy a typical basic-rate taxpayer earning £24,100 would pay £180 more a year, while a higher-rate taxpayer on £67,100 would pay £715.
As well as providing extra funding for the NHS to deal with the backlog built up during the COVID-19 pandemic, the new package of £36billion over three years will also reform the way adult social care in England is funded.
The Government will fully cover the cost of care for those with assets under £20,000, and contribute to the cost of care for those with assets between £20,000 and £100,000.
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In scathing criticism yesterday, former minister Steve Baker accused Mr Johnson of forgetting what it means to be a Conservative by increasing tax.
“Now the Conservative Party, at some stage in our lifetimes, is going to have to rediscover what it stands for because I have to say at the moment we keep doing things we hate, because we feel we must,” he said in the Commons.
“We all know that eventually as a socialist you run out of other people’s money.”
Chair of the Northern Research Group of red wall Tory MPs, Jake Berry, also attacked the plan for being “un-Conservative”.
The Rossendale and Darwen MP said: “If it’s an NHS tax which will be hypothecated and listed on your payslip then call it that, don’t call it a health and social care tax because it’s to fund the NHS and when the time comes to move the money from the NHS over to health and social care, what Government of any political hue is going to cut £12billion from the NHS budget?
“So if you create an NHS tax, you have an NHS tax forever, it will never go down, it can only go up.
“No party is ever going to stand at an election and say I’ve got a good idea, vote for me, I’ll cut the NHS tax.”
Addressing the 1922 committee of backbench Conservative MPs shortly before the vote the Prime Minister insisted the Tories were still “the party of low taxation”.
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