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Today's business and finance round up 6th September 2021

💸National Insurance increase on the cards

September 06, 2021

6th September 2021

Good morning Just when we thought the summer was over the British weather throws up one last surprise. Parts of the England and Wales will see temperatures of up to 29C this week meaning there’s a good chance of a heatwave.

Today's stories

  • National Insurance increase on the cards

  • Covid test firm crackdown

TAXATIONNational Insurance increase on the cards

What’s going on?Rumours have been circulating in the weekend papers that the government is considering raising National Insurance (NI) to fund the social care system.

Why is this important?

NI is paid by employers and workers up until they reach the state pension age. For someone on average earnings of £30,000, a 1% increase in NI would cost them close to £200 a year and would raise about £10bn in tax revenue.The ageing UK population has created a huge demand for social care. On top of this previous governments have failed to fund and reform the system meaning that to right the wrongs of the past will now cost billions of pounds.Social care provision is devolved across the four nations of the UK, meaning governments have the freedom to implement solutions unique to their own region.Increasing tax would go against the Tory manifesto from the last election which pledged not to increase income tax, VAT or NI.TakeawayThe government has yet to confirm or deny the claims but the speculation is already proving unpopular in the Labour and Conservative parties. Many MPs argue that increasing NI would disproportionately impact lower income and younger workers in order to pay for the care of the older generation. Critics say that as NI is only paid on earnings wealthier people who live off rental income, savings or dividends would be off the hook.

COVIDCovid test firm crackdown

If you’re one of the millions who have needed to show negative Covid-19 results to travel abroad you will no doubt have come across the hundreds of companies offering to fulfil the service.Almost overnight PCR testing for Covid-19 became a multi-million pound industry. Unsurprisingly unscrupulous firms have popped up ready to take advantage of desperate consumers. Holidaymakers have complained of high prices and missing tests or results from many of the firms, prompting Health Secretary Sajid Javid to call for a review into "excessive" pricing and "exploitative practices".To combat this the competition watchdog has launched a wave of action in the PCR testing market over concerns that consumers are getting ripped off.In the UK tests cost about £75 per person on average but there are reports of some being offered for more than £500.The UK is one of the most expensive countries in the world to get a PCR test. In France it costs £42 and in Turkey it costs just £21.

Stat of the day

Almost 50 British chain stores closed every day in the first half of 2021

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Interesting links from around the web

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