Sunak brings in Universal Working Income - and credits CPS

The Centre for Policy Studies warmly welcomed the Chancellor’s landmark decision to raise National Insurance thresholds to the same level as income tax, in response to the cost of living crisis.


This policy, the Universal Working Income, was suggested by the Centre for Policy Studies in its landmark 2018 paper Make Work Pay, and was adopted by the Conservatives in their 2019 manifesto. At the time, we calculated it would take 2.4 million people out of tax altogether.


The CPS had recently argued that increasing NI thresholds was the best way to offset the effects of the Government’s increase in National Insurance for those on low and average incomes – but welcomed the Chancellor’s decision to go much further.


The Chancellor explicitly acknowledged the CPS’s work in this area in his statement.


Responding to the Spring Statement, Robert Colvile, Director of the Centre for Policy Studies, said:


“We are delighted that the Chancellor has adopted our proposal to increase the National Insurance payment threshold to match the Income Tax threshold and create a Universal Working Income. It is great to see CPS ideas continue to make their way into Government and help reduce the tax burden for millions of people.


“As the cost of living crisis deepens it is absolutely right to protect lower earners from paying additional tax – but raising the NI threshold to match that of income tax is also a great idea full stop.”

Date Added: Wednesday 23rd March 2022