BORIS Johnson dramatically pledged a £465 tax cut for 31million workers today in his boldest election move yet.
The PM announced he would raise the income threshold at which workers start paying National Insurance from £8,632 to £9,500 from April 2020.
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That will mean a £100 tax cut for most people but he pledged the threshold would be raised to £12,500 by the mid-2020s – handing a £465 tax cut in total to the vast majority of the UK workforce.
The move is ultimately expected to take 2.4million people out of paying the tax altogether.
Mr Johnson said the huge tax giveaway was proof the Tories want “do more to help people on low incomes with the cost of living, to put more money into their pockets”.
The PM insisted the huge tax giveaway was “affordable” but experts warned the overall cost of raising the threshold to £12,500 would be at least £11 billion.
The initial cut for next year – to be announced in the first Budget if the Tories win a majority on December 12 – will mean nobody pays National Insurance on their first £9,500 income next year and will save nearly all workers approximately £100.
On a frantic day of campaigning in the north east the PM also:
- Announced a bumper package of measures to help ‘Generation Rent’ as he promised to finally bring an end to the scourge ‘no fault evictions,’ a new scheme to allow tenants to transfer their deposits when they move homes and a pledge to build one million homes by 2025.
- Unveiled plans that could double maximum sentences to two years for criminals who assault emergency workers such as the police, paramedics, NHS workers and fire fighters.
- Vowed to substantially reduce the soaring bill for HS2 but signalled he would not scrap the project.
- Signalled a major social care policy in the manifesto as he vowed to ensure “nobody has to sell their home to pay for the cost of their care”.
- Defied all general election convention by revealing he will launch his manifesto for power on a Sunday for the first time in history. All workers currently pay National Insurance at a rate of 12p in every £1 on income earned between £8,632 and £50,000, at which point it is charged at 2p in the pound.
The huge tax cut pledge was forced out of the PM after a worker confronted him over what tax cuts he would be offering Britain’s lowest paid on the campaign trail in Teesside today.
The flagship policy was meant to be saved for the Tory manifesto launch on Sunday, leaving aides scrambling to brief out the details of the policy last night.
He was grilled in a Q&A after a stump speech to factory workers.
Claire Cartlidge, 35, who lives in Doncaster and is head of fuel policy for Stobart Energy, said she was “wound up” by Mr Johnson’s claim that he could cut taxes after Brexit.
The Remain voter asked him: “You said low tax, do you mean low tax for people like you or low tax for people like us?”
Mr Johnson replied: “I mean low tax for working people. If you look at what we are doing and what I said in the last few days, we are going to be cutting National Insurance up to £12,000.”
Aides later clarified that the PM meant the eventual threshold would be £12,500 because the policy is designed to bring National Insurance thresholds in line with personal income tax rates.
Self-employed workers will also benefit from the move through a rise in the Lower Profits Limit, which will also kick in at £9,500 from April next year.
Explaining why he had decided to include the huge tax giveaway in his formal offer to voters, the PM said: “The thinking behind it is that we’re tax-cutting Conservatives but we think this is the moment to help people with the cost of living, and to do more to help people on low incomes with the cost of living, to put more money into their pockets, and we have to do that in a way that is prudent, that is affordable, and we have been working on this for a while as you can imagine.
“We will initially go up to £9,500 in the first stage but of course the plan is to go up to £12,000.
“This will put around £500 in people’s pockets. It’s good for the economy, it stimulates consumption, it stimulates growth but it also will help people with the cost of living, and the cost is I think about £2.1bn in 2021, so it’s affordable.”
He asked for Tory voters’ patience on tax cuts for higher earners – insisting it was still his “ambition” to raise the higher 40p income tax threshold from £50,000 to £80,000 but won’t be in the Tory election manifesto.
Mr Johnson insisted: “It doesn’t mean there may not be more to come.”
He added: “Don’t forget that everybody is comprised within the NICs increase but priority must be for those who need to cope with the cost of living.”
Current National Insurance rates 2018/19
EMPLOYED (class 1 NI)
Less than £8,424 – don’t pay National Insurance
£8,424 – £46,350 – pay 12% National Insurance
More than £46,350 – 2% National Insurance
SELF EMPLOYED (class 2 and 4 NI)
Less than £6,205 – pay nothing
£6,205 to £8,424 – £2.95 per week
£8,424 – £46,350 – 9% plus £2.95 per week
More than £46,350 – 2% + £2.95 per week
UNEMPLOYED (class 3 – voluntary contributions)
£14.65 a week
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The announcement came as Mr Johnson toured Labour strongholds in the north east of England that heavily backed Brexit.
In a scale of the party’s ambition, he even included Tony Blair’s old constituency of Sedgefield – a historically safe Labour seat currently held by prominent Remainer Phil Wilson with an 8,000 majority.
Tory aides last night revealed the PM will launch the party’s election manifesto on Sunday – with officials debating between Midlands or Yorkshire as a venue to make their pitch for power.
The PM’s formal offer to voters will be unveiled in four days time over the weekend, which is usually used as a down day for politicians and campaigners. But CCHQ chiefs picked the day as research reveals it’s the moment that most of the undecided and disinterested watch TV.
Mr Johnson also said he wants to see the bill for HS2 come down, but that he would “hesitate before simply scrapping” the rail project.
He told reporters: “You have to look at the size of the bill – it’s huge.
“You have to consider whether the thick end of £100billion is being properly spent. You have to consider whether we’re profiling that spend correctly.”
Asked if he wanted to see the bill come down, he replied: “If possible.”
The Tory manifesto is expected to come out within the next week, outlining the party’s full plans for the country.
The cut would help the lowest paid workers the most, who have already benefited from the Tories’ raising of the limit they start paying income tax over the last five years.
Business Secretary Andrea Leadsom dropped a huge hint that the move was coming last month, saying: “A Conservative government will always be a tax-cutting government.
“We will set out more in the manifesto about our ambition for income taxes.”
The Institute for Fiscal Studies estimated the policy overall will cost more than £11billion. It will cost £3billion for every £1,000 the threshold rises.
The PM was due to reveal tax cuts in the Budget – but that’s now been scrapped because of the impending election.
Back in June before he became PM he said he was prepared to increase the public debt to cut taxes.
He suggested he would take anyone earning £12,000 or less out of national insurance.
Debate is top show
A SURPRISING 6.7million people watched Boris Johnson and Jeremy Corbyn’s TV clash on Tuesday.
The show, hosted by Julie Etchingham at 8pm on ITV1, peaked at 7.3million viewers — beating all competition with 32.3 per cent audience share.
Younger people watched the most, with the debate drawing 40 per cent of all viewers aged between 16 and 34.
Bookies shortened the odds of a Tory majority after a poll awarded Mr Johnson a 51-49 win in the debate.
But the Tories were ridiculed on Twitter after the party changed the name of its official account to “FactCheckUK” in an attempt to call out Jeremy Corbyn’s claims.
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