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Man’s an idiot. Or a liar, you decide

Then national insurance is charged at 12% on the employee and 13.8% on the employer (which is a cost that economists agree effectively comes out of wages, so it’s really paid by the employee). That’s a combined tax of near enough 25.8%, higher than basic rate income tax.

Add on to that the fact that national insurance largely stops, by falling to 2%, when wages reach £50,268 a year (current rates), and the tax suddenly looks very far from progressive.

Agreed that both NIs are coming out of the wages.

But does the man not know that there’s no upper limit on employers’ NI?

Is this ignorance or lying?

13 thoughts on “Man’s an idiot. Or a liar, you decide”

  1. I think he can be both with no Issue. He reminds me of a manager in one of my former jobs. The workforce’s comments were along the lines:

    ‘I know you’re lying because your lips are moving’

  2. I will never forget the time when the tax cutting government I voted for put my taxes up by removing the ceiling on employers NI. I’ve never trusted the fuckers since.

  3. It’s 23.7% – if there were no other taxes at all then you get to keep £88 of every £113.80 you earn or generate.
    The twat.

  4. To be fair, he’s right that it’s all an income tax. And while he’s being disingenuous in the way he presents figures, dropping from not* 25.8% to not* 15.8% at the UEL is not progressive. However, I doubt he complained when Brown was whacking up NI rates and would not be surprised to see evidence of him having called people who wanted NI rolled into IT, the logical conclusion from what he’s right on, ghastly neoliberal shills for some spurious reason.

    * Not because it makes no sense to me to calculate it as a percentage of nominal salary: the denominator should be (nominal salary + employer’s NIC)

  5. In response to being called out on it….

    Richard Murphy says:
    July 20 2021 at 12:33 pm

    I post this without checking because I am pushed for time…..

    No word on why the innumeracy elsetimes…

  6. So how is this any different to corporation tax, which he swears is paid for by the company and nobody else?

  7. I see he is still wearing the same cruddy shirt in a video about tax havens. He’s never going to make it in Bollywood

  8. I can’t work out which the most egregious part of our tax system is: employer’s NIC as a general concept or the withdrawal of the personal allowance between £100k and c. £125k…

    Are any of our longer in the tooth commenters able to comment on whether Er’s NI has always existed or was it brought in as another stealth tax?

  9. @ samuelbuca
    Employer’s NI predates stealth taxes, but only dates from the Attlee government which introduced the “welfare state”

  10. He’s correct it’s “an” income tax, but it’s a tax on wages not a tax on income.

    And it’s not a “contribution”
    And it’s not “insurance”

  11. @ jgh
    There is *an* element of insurance in NI – if you’ve paid your contributions regularly you are entitled to a basic level of JSA if *made*, not of your own volition, unemployed. This is generally less than the means-tested benefit given to those who have never paid any NI in their lives, but it is *something*.

  12. I sneeze in threes

    Let’s not forget the stupid apprentice levy employers pay, that’s another 0.5% on the pay bill.

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