Britons will have more money in their pockets as the result of a new government policy to increase the National Insurance threshold. The United Kingdom’s Conservative Party is implementing a policy recommendation put forward by the Centre for Policy Studies (CPS), an Atlas Network partner based in London, that will make it easier for small businesses and employees to thrive.
CPS’ research paper, “Make Work Pay: A New Agenda for Fairer Taxes,” called for raising the National Insurance threshold—the point at which employees and the self-employed start paying National Insurance tax—as a way to give workers and business owners a chance to keep more of their earnings. In March, the Chancellor of the Exchequer, Rishi Sunak, introduced a budget that raised this annual threshold from £8,632 to £9,500. This change has the impact of a tax cut for an estimated 31 million UK citizens. The Conservative Party plans to raise the threshold to £12,500 in coming years.
“Our proposal to increase the National Insurance threshold means workers are allowed to keep more of the money they earn,” explained Robert Colvile, Director of CPS. “Fundamentally, we believe in giving people more control of their own lives—many of our policy suggestions are developed with this in mind.”
CPS worked in tandem with several elected officials to produce policy proposals for presentation to the Conservative Party. These officials include the Rt Hons Damian Green MP and Priti Patel MP, who was named Secretary of State for the Home Department after her contributions to CPS. In addition to crafting the recommendation, CPS hosted events, debates, and conferences to promote this and other policy proposals.
Other CPS proposals for policy changes embraced by the Conservative Party include creating a bespoke visa system for entrepreneurs who could create high-value companies, devolving power to regional government bodies, and creating “Free Ports” which would exempt users from tariffs. CPS expects these recommendations will also be implemented as policy over the coming months.
“The Government is currently consulting on how best to introduce Free Ports to boost global trade, attract inward investment and increase productivity,” concludes Colvile. “we are pleased a number of policy ideas we have proposed are on course to be adopted by the Government.”
Centre for Policy Studies has received Atlas Network grant support for its work.