We have previously covered the individual tax plans of the prospects to become next Prime Minister. The leader in the internal Conservative race to be the next leader is Boris Johnson, and it is his tax plans that could have the most effect to the pocket.
Johnson plans to increase the higher rate threshold by £30,000 and then align the National Insurance upper earnings/profits limit to the same amount. This would mean people paying 40 percent tax would have to earn over £80,000, however people would also be paying 12 percent national insurance contributions all the way up to £80,000 of income, rather than the current £50,000.
Essentially, the tax change between £50k and £80k is a a ten percent cut. 42 percent versus 32 percent. The problem, however, is with people who earn over the current higher rate limit but don't pay NIC's at all- i.e. pensioners. They would receive a tax of 20 percent, or pay half as much tax on those earnings as they currently do.
The other people to be negatively affected are those in devolved tax regions. Scotland has its own tax bands and rates. It does not however have devolved National Insurance rates and bands. What this means is that people in Scotland will continue to pay 41 percent tax (the rate for income between £43k and £150k) but have a 10 percent increase to national insurance, from the current 2 percent to 12 percent. Put in simpler terms, the largest slice of the income range will pay 5 times more in NIC's. So, no benefit to higher rate Scottish taxpayers but a tax increase.
Scottish Conservatives have responded to this revelation as expected by saying Boris' plans have not been given much thought. This leads people to believe that Liz Truss, likely to be Chancellor if Johnson gets in, would only raise the higher rate threshold by £10-15k, half of what Johnson initially proposed.