§ Mr. PondTo ask the Secretary of State for Social Security what estimate she has made of the additional revenue resulting from the abolition of the upper earnings limit on the payment of national insurance contributions. [5458]
§ Mr. DenhamAn estimated £4.05 billion would be raised in a full year if the upper earnings limit on employees' class 1 contributions and the upper profits limit on class 4 contributions paid by self-employed people were removed and about 3.75 million people would become liable to pay more contributions.
The figures assume that the current 10 per cent. class 1 contribution rate would apply to earnings above the present upper earnings limit, the current 6 per cent. class 4 contribution rate would apply to profits above the present upper profits limit and that an upper earnings limit would remain in place for the calculation of employee and employer contracted-out rebates.
Source:
Government Actuary's Department.