The Fairer Way To Pay For Social Care

Recently, there’s been much talk about Boris Johnson wanting to increase National Insurance contributions to fund rising social care costs. Whichever way this is presented, it’s a tax hike – something the Tory manifesto on which they were elected said would categorically not happen along with Boris’ statement that he had a plan for social care – during his speech on the 24th July 2019, Boris Johnson said: “I am announcing now – on the steps of Downing Street – that we will fix the crisis in social care once and for all with a clear plan we have prepared to give every older person the dignity and security they deserve.”

It now appears that there was no plan, and Boris clearly seems to have forgotten his pledge during the 2019 General Election that ‘We will not raise the rate of income tax, VAT or National Insurance.’

Not to mention that raising National Insurance would disproportionately impact younger people and lower earners as the rate drops from 12% to 2% on income above £50,000. So is it fair that people with triple locks on pensions who are also beneficiaries of the golden age of capitalism and have experienced the largest house price inflation over the last 40-50 years don’t have to cough up, along with higher earners? It seems wholly unfair and not thought through.

People always say, ‘well, it’s easy to criticise, have you got a better idea’ to which the answer is, yes!

Bring Capital Gains Tax in line with income tax rates. Simples.

If Boris is really bothered about ‘levelling up’ whatever that means, then it’s about time he stopped looking at taking from those whom he purports to care about.

The move to increasing CGT to the same rates as income tax has the potential to bring in an additional £14bn in tax receipts, according to a report by the Office of Tax Simplification (OTS), a Treasury-based body. This would be more than enough to pay for the social care needs that have to be met, as Labour had a fully costed social care plan which came to a little over £11bn, whilst leaving alone the income of the younger generation and lower-paid workers who already struggle with trying to get on in life as best they can. It would instead affect those who have assets that have made gains over time, typically by nothing other than holding an asset as it appreciates. How could that not be considered a better idea than just a crude tax hike on those that can least afford it?