It's Tax Rises for All

By Reiss, Charles | The Evening Standard (London, England), April 17, 2002 | Go to article overview

It's Tax Rises for All


Reiss, Charles, The Evening Standard (London, England)


Byline: CHARLES REISS

FOR ALL GORDON BROWN today embarked on a tax raising Budget which hit employers and employees alike to fund the NHS.

From April there will be an additional one per cent National Insurance contribution from employers, employees and the self-employed on all earnings over [pound]4,615.

People earning [pound]10,700 a year will pay [pound]1.65 a week, those on [pound]21,410 will pay [pound]3.70 a week, and those on [pound]32,100 will pay [pound]5.75 per week. From 2003-04, to pay for large-scale NHS reforms, non-pensioner income tax allowances National Insurance Contribution the price of a pint by this summer "in time for the World Cup". Mr Brown promised [pound]4billion of extra spending on key public services next year.

But the Chancellor and Prime Minister had already made it clear that the overall tax burden would have to rise to pay for better transport, schools and other public services and, above all, to increase health spending by as much as [pound]25 billion over the next six years.

The sheer cost of reviving the NHS - with a threat of high taxes for decades - was spelled out in a report on the future of the National Health Service.

The Wanless report says that expenditure running at an annual [pound]68 billion thresholds will be frozen at [pound]4,615. But there were some substantial crumbs of comfort for Middle England, drinkers, drivers and for businesses, large and small. He also abolished the tax on Bingo.

At the same time as he swooped to secure billions more to fund the health service, the Chancellor offered a generous handout to many families.

He began his Budget with an announcement that his new Child Tax Credit will go to parents on incomes of up to [pound]58,000 a year.

Duty on the products of local breweries will be cut by half, a cut of 14p in Budget 2002 More reports: Pages By Charles Reiss Political Editor Continued on Page 2

needs to climb to [pound]184billion by 2022.

Despite the reform difficulties and the staggering cost, Mr Brown stuck to his message that the NHS, funded by the taxpayer, represented "the best insurance policy in the world".

Mr Brown, in his Budget speech, promised that his measures would give the NHS "a secure financial foundation for the long-term".

A bitter political row erupted ahead of the Budget, with the Tory health shadow, Dr Liam Fox, accusing the Chancellor of trying to "railroad" the country into a one-way only system of health funding.

His allies had already said that he would not shrink from spelling out the tax consequences, including a detailed account of what his proposed tax increases would mean for families and individuals at various levels of the salary scale.

A hefty rise in National Insurance payments was seen as the Chancellor's preferred means to find extra money in the Budget. …

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