A Parliamentary vehicle, known as a Ten-Minute Rule Bill, will be introduced by Ben Gummer, MP for Ipswich, and will highlight the fact that National Insurance is, in reality, a second form of income tax.
Some commentators see this as the first step on the road to merging NI and income tax. And, it is reported, that the move has some sympathy from Chancellor George Osborne who is understood to be 'attracted to the idea', although he has yet to make a public commitment to it.
Mr Gummer is using this procedure to draw attention to his campaign for better transparency in taxation, but it is unlikely his efforts will reach the Statute Books, as they are usually used to raise the profile of a subject rather than a serious legislative attempt.
Mr Gummer said: "I am very pleased the Government is interested in the idea. They have been very receptive to trying to make the tax system more transparent. This would be a really good step forward in making what the Government takes from taxpayers clearer and simpler.
“Changing National Insurance to Earnings Tax is a very simple first step to doing what most people think is a good idea, which is merging it with Income Tax. I’ve thought for some time that one of the easiest ways of getting more simplicity in the tax system is just being more transparent about tax.
"Taxpayers are consumers – both parties have recognised that for some time, so if we give them a better handle on what they are paying and where it goes, you only enhance the conversation that you have with politicians.”
National Insurance was introduced by Liberal Prime Minister David Lloyd George in 1913 to pay for state pensions and other benefits. But it has been many years, since National Insurance payment went solely to pay for the welfare state, leading to the charge that it has become just a hidden form of Income Tax.
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Susie Hughes © Shout99 2014