The Government of the British Conservative Prime Minister, Liz Truss, announced this Thursday the elimination of the increase in the contribution to social security introduced by the previous Executive of Boris Johnson.
The head of Economy, Kwasi Kwarteng, has processed this Thursday a law so that on November 6 the increase of 1.25% of that contribution that has been applied since last April will be annulled, while another increase of 1.25% will not come into force either. which was scheduled for April 2023, is indicated in a statement.
The announced increase of 1.25% in rates on dividends is also reversed, it adds.
These tax increases, which affect both citizens and companies, were designed to specifically finance social services and social care, which were especially reduced during the pandemic.
The Government has assured today that the amount that was expected to be collected, about 13,000 million pounds (€15,000 million) per year, will also be allocated to that sector, obtained from general taxes.
The controversial revocation of these taxes, devised by Kwarteng’s predecessor, Rishi Sunak – who was Truss’s rival for the leadership of the Government – is part of a general “growth” plan that this Executive will detail on Friday.
According to advances, as part of this strategy, the Government will not increase corporate tax and will eliminate the cap on premiums in the financial sector, while granting loans to energy distributors to limit the increase in bills.
While taking these measures, which will lead to an increase in public debt, which she plans to reduce “in the medium term”, the Prime Minister plans to ease regulations and bureaucracy in both the finance and construction sectors, among others.
In its statement, the Government stresses that its main mission is “to raise the standard of living in the United Kingdom by growing the economy through the private sector.”
Thanks to the tax cut, “companies will have more money to invest in being more productive, paying higher wages, creating more jobs and supporting the general growth of the economy,” he argues, in an economic argument that is refuted by the Labor opposition .