When the Prime Minister came into office, he pledged to halve inflation and grow the economy. Having taken the difficult decisions to bring our public finances under control, we can clearly see that the plan is working. There is still more to be done, but inflation is falling, and our fiscal standing is improving.
As a low-tax Conservative, I believe it is right that the tax burden on hard-working people should be as low as possible. Now that the wellbeing of our public finances is under control, it is right that people should be allowed to keep more of their hard-earned money.
Starting on the 6th of January, the cut to National Insurance announced in the Autumn statement came into force. This change means a reduction of the main rate of National Insurance to ten per cent, saving 27 million workings an average of £450 a year.
Because of the new National Insurance cut, a hard-working family with two earners on the average income will be £900 better off; a senior nurse with five years of experience will be better off by £600; the average police officer will be better off over £630; a typical junior doctor will be better off by over £750; a typical self-employed plumber will be better off by over £410; and the typical teacher will be better off by over £630.
These are important savings which will benefit those in Wycombe and across the UK who are responsible for driving our economy forward.
This tax cut would not have been possible under Labour, who have consistently to refuse to back the sensible measures for the long-term that the Government has been implementing. Under a Labour government, the country would have no choice but to fund their £28 billion plan through tax rises and more borrowing.
Additionally, the Government have committed to going further by cutting and simplifying tax for two million self-employed people in the UK, supporting the country’s entrepreneurs. Later this year, the Government will abolish an entire class of NICs and cut the rate of the NICs top rate from nine per cent to eight per cent for the self-employed. This will result in savings of around £350 for someone earning £28,000 a year.
The Autumn Statement also cut business taxes permanently by £11 billion a year, which is the biggest business tax cut in modern British history. The Government promised to make full expensing permanent when the economic conditions allow and have now delivered that, enabling businesses to invest for less and offset investments against their tax bills.
The Prime Minister’s plan is working, and I am pleased to see our stronger fiscal position directly benefit all those who work so hard to make our country’s economy strong.