§ Mr. EdwardsTo ask the Chancellor of the Exchequer if he will estimate the change in revenue resulting from a reduction in the NIC rate by 1 per cent. assuming(a) the upper earnings limit remains as it is, (b) the upper earnings limit is set at the threshold of the higher rate of income tax at £575 per week and (c) the upper earnings limit is abolished. [151424]
§ Dawn PrimaroloThe full-year effects in 2001–02 of making the changes are set out in the table.
Full-year effect in 2001–02 of a 1% reduction in the employee rate of National Insurance Contributions Cost (£ billion) (a) With the upper earnings limit at £575 per week 2.80 (b) With upper earnings limit set at the income tax higher rate threshold (equivalent to £652.60 per week) 2.90 (c) With no upper earnings limit 3.25 The estimates show the reduction in gross employee contributions only—rebate rates have not been affected.