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National Insurance

Volume 476: debated on Monday 2 June 2008

To ask the Chancellor of the Exchequer what estimate he has made of the additional cost or saving to the Exchequer that would arise from collecting employee national insurance on an annual cumulative basis similar to PAYE. (207965)

At Budget 2006 the Government announced that they would review the case for aligning income tax and national insurance, with the aim of reducing administrative burdens on employers and improving outcomes for those on lower incomes. The report “Income tax and national insurance alignment an evidence-based assessment” published at pre-Budget report in October 2007 sets out the conclusions of the review, and Chapter 3 includes detailed analysis of the costs and benefits of moving to an annual and cumulative NICs system.

The report can be found on the HM Treasury website at:

http://www.hm-treasury.gov.uk/media/B/B/pbr_csr07_ incometax713.pdf