Should Income Tax And National Insurance Be Lumped Together Into Just One Tax?

[dave50]

After all, national insurance is just a tax with another name. Why not merge them to create one tax payment?

[Hopkirk]

People who work beyond retirement age don't pay NI, so lumping it all into one would hit them.

[ToraToraTora]

no they are structured completely differently.

[dannyk13]

Hopkirk //people who work beyond retirement age don't pay NI//
But they might under Boris's proposals.
//This would include people in work who are over the state pension age, who don’t currently pay NI.//

[Jackdaw33]

For the first 30 years NI was a flat rate payable by all in employment, irrespective of income. In the 70s Wilson had the bright idea of making into a % of income. As has been said, people over retirement age do not pay NI, though they will pay the new levy from 2023.

[Hopkirk]

Danny, only the new uplift will be paid by them, not the main bulk of NI.

[dannyk13]

Hopkirk // only the new uplift will be paid by them,//
How does that work, will it be a flat payment?

[Jackdaw33]

No, it will be 1.25% of taxable income.

[THECORBYLOON]

As I understand it, it's 1.25% of earnings from £9,568 and above, not taxable income.

[Peter Pedant]

nope
you want the long answer? nooooooope!
ter daaah!

This is law and politics - NI was hypothecated ( used for pension and NHS) and so the original NI act did NOT begin as a money bill

" may it please your majesty, we are voting you moolah...."
and presumably she did not assent ( but I dont know that bit) as a sovereign assenting to a tax bill
le reyne remercie ses bons sujets et le veult

but used the standard formula - tired yet? - "yeah foo!"
in Normal French - way- foutay le camp!

and so it is not a tax measure and..... doesnt count in the tax infaltion thingeys - it counts somewhere else

AND so - if it a tax - oh by the way the opening formula changed to a tax opening a few yeas ago - then it bumps up inflation mega mega and that would never do

These consideration may also have played a part in doing NI and not tax