Last Wednesday, Philip Hammond made a joke at Norman Lamont’s expense by reminding the world of how John Major’s first chancellor was sacked after a negative public reaction to his budget in 1993. Hammond, one suspects, is already beginning to regret his gag as Lamont today became the latest Conservative to damn his plans to raise National Insurance contributions on the self-employed.
What has been so damaging is not so much the staged 2 per cent rise in contributions as the strong hint that he is considering going far further and equalising, as he sees it, the NI contributions of employed and the self-employed in the name of ‘fairness’. Employees currently pay 12 per cent of their income between £155 per week and £827 per week, while their employers chip in a further 13.8 per cent. The self-employed, by comparison, pay 9 per cent on income between £155 per week and £827 per week.
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