Ahead of @RishiSunak announcements tmrw we should talk about cuts to employers National Insurance - an option the government has been considering to help tackle rising unemployment...
Why it's right to be considered: cutting employers NI brings down the costs of employing workers. It's a wage subsidy via the tax system - and wage subsidies in the likes of hospitality and leisure are a good idea right now...
...BUT there is a big problem: the jobs we're trying to protect are low paid - many of which are already exempt from National Insurance (if wages are under £169/wk) = 1/3 hospitality workers and 1/4 retail workers. And since 2015 firms already pay zero NI for workers under 21s
This is why a direct wage subsidy scheme for hardest hit sectors (ie just pay 10% wage costs) is better suited to the specifics of this crisis than National Insurance cuts - despite those being the generally popular policy level for Conservative chancellors.
IF you are going to cut employers National Insurance it should be done by raising the threshold at which employers start paying it NOT by cutting the rate employers pay (currently 13.8%) so that support is focused on lower (but not the lowest) earners
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