National Insurance: Threshold rise may be considered to help Britons following £12billion | Personal Finance | Finance

Chancellor Rishi Sunak is due to give the Spring Statement tomorrow with some believing he will announce new measures to help the British public weather the current cost of living crisis. While many hope the 1.25 percent National Insurance increase will be scrapped or delayed, others say a threshold increase will be a more realistic solution.

Since the Autumn Budget a variety of unexpected changes have impacted the economy.

At the time when the rise was initially announced, inflation was expected to peak at five percent but current predictions have seen numbers as high as 10 percent predicted. 

Compounding this, the Russian invasion of Ukraine has spelled disaster for energy prices when the bills were already due to increase to almost unaffordable levels.

In the beginning of February, Ofgem announced the energy price cap would be increased by almost £700 on the same day the Bank of England doubled the base rate to 0.50 percent.

READ MORE: Pension death benefits may be at risk in Rishi Sunak’s spring statement – ‘too generous!’

To help Britons, Chancellor Rishi Sunak announced a package of measures to save household finances including a council tax rebate and energy loan due in April worth £350 per household. 

Some believe similarly unexpected saving measures could be announced tomorrow in the Spring Statement. 

Mr Sunak is reportedly considering increasing the National Insurance threshold, which would see lower earners paying less tax. 

The income tax threshold at which point people start paying the basic rate has increased in recent years to £12,500 while the National Insurance threshold has dragged its feet when doing the same.

DONT MISS: 

“We’ve done it in a fair way, and going forward my priority is to cut tax and put money back in people’s pockets.

“We’re putting in place a new NHS and social care levy because we care about the NHS and we were faced with the, I think, unpalatable and unacceptable situation of millions of people having to wait years to get the treatment that they need. 

“That wasn’t OK when we’re recovering from coronavirus and there’s a team at the NHS who are prepared to work incredibly hard to help work through that backlog over the next few years.”

He continued: “I think they deserve and need our support and funding in order to do that, and that’s why we put in place this measure. 

“Yes, there are challenges with Ukraine that have come along, that hasn’t changed the underlying situation that there’s this backlog and we want to get that funding to the NHS.”

The Chancellor said on BBC One’s Sunday Morning programme: “What I’d say to people, I know it’s difficult, but you can be reassured that every penny you pay of this levy, unlike any other tax, goes directly to the thing that you care most about which is the NHS.”