UK:
Deloitte Comments On Plans To Merge Tax And National Insurance Schemes
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Mark Groom, Partner in Deloitte's employment taxes group,
said: "The Chancellor's announcement that the Government
will consult on merging the tax and national insurance schemes is a
bold move. We welcome the intention to harmonise employment income,
but the key challenge here is around pension contributions. The
single person income tax allowance is £8,105 whilst the
equivalent allowance for NIC is around £5,500. To lift one
allowance up to the other would be costly.
"Perhaps the greater challenge though is that national
insurance doesn't apply to pension and savings income and
won't in the future either, which means that full harmonisation
can't take place."
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