TAX RISES TURN SCREW ON FAMILIES

THE Government’s proposed national insurance tax rise comes into force this week, adding pressure to household budgets.

Ministers have said the plan is to use the extra revenue, collected from April 6, to fund the NHS, health and social care. It will see employees, employers and the self-employed all pay 1.25p more in the pound for NI.

For employees they would previously pay 12% on earnings up to £50,270 and 2% on anything above that. From April 6, the rate goes up to 13.25% and 3.25% respectively.

For the self-employed, rates will go up from 9% and 2% to 10.25% and 3.25%.

Payments will only be collected on wages above £9,880, although this rises to £12,570 in July – a threshold change announced by Chancellor Rishi Sunak at the recent spring statement.

However, despite the rise in the national insurance threshold, the changes overall are expected to make many people worse off, at a time when costs are rising.

Car tax also went up from yesterday with the size of the increase dependant on a vehicle’s emission levels.

The duty will rise in line with the Retail Price Index measure of inflation, but people with more environmentally friendly vehicles will see smaller rises.

Council tax is also rising after Chancellor Rishi Sunak gave local authorities the go-ahead to increase rates by up to 2.99% without the need for a referendum, on top of an additional 2% increase which is ringfenced for adult social care.

The tax picture will vary across different parts of the country but many authorities have confirmed they will implement the maximum increase, including several in the South West.

There is better news in the South West for water bill payers. South West Water is giving customers a cut in their water and sewerage charges.

The Exeter-headquartered company, part of Pennon Group Plc, said the average annual bill for water and wastewater services will be less in 2022/23 than last year and lower than 10 years ago.

The average household bill will now be £472, a fall from £483 in 2021/22. Customers will also continue to benefit from the £50 Government Contribution, to cut household bills, for 2022/23.