Conservative Party's national insurance claims thrown into doubt
A report by economists working for the shadow Chancellor George Osborne in 2007 has cast doubt on Conservative Party accusations regarding an increase in national insurance and the impact this would have on the employment market. The Conservatives are claiming that a 1% increase in national insurance would lead to 57,000 job losses in the UK although using the formula from the 2007 report this could actually be as low as 23,000.
The truth is that there are many hidden impacts from an increase in national insurance which will only become apparent if an increase is pushed through. There are pros and cons as both political parties have stated although ultimately an increase in the cost of running a business is almost certain to lead to a reduction in investment and job losses. It is difficult for the man on the street to understand how an increase in the cost of business dealings can in any way lead to a positive outcome?
The truth is that whether national insurance is increased or any other tax introduced or increased by the next government, there is a need to replenish UK coffers. National debt will be well over £1 trillion at the end of this year and the budget deficit is unlikely to fall below £80 billion a year until 2014 at the earliest.
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