The government will raise National Insurance by 2.5% and announced a similar increase to the way dividends are taxed to help fund social care.
Investment in the care system is long overdue but the majority of funding in this announcement will go to the NHS. Nor does the policy go far enough, according to plans set out by the Women’s Budget Group.
Tax Justice UK Head of Advocacy, Tom Peters, said: “Tackling the crisis in social care is long overdue, but the proposed reforms don’t go far enough, and National Insurance is an unfair way to fund investment in the care system.
“After a pandemic that saw the wealthiest become even richer, those with the broadest shoulders should be first in line to take the strain as we start to build back.
“That means tax reforms including equalising capital gains with income tax, abolishing tax loopholes and ensuring companies pay their fair share of tax should also be on the table if we are to create the best possible social care service for all."