Tax Cuts: Fiscal Impact

Lord Rooker Excerpts

Wednesday 13th July 2022 Lords Chamber

[Baroness Penn (Con)]

My noble friend talked about the impact of the lockdowns. They had a significant economic impact but also a significant social impact—for example, on children who were unable to go to school during those periods. However, our vaccine rollout meant that we could come out of that cycle of lockdowns earlier than many other countries. On her point about the tax cuts on fuel that we put in place to help with the cost of living, we have been very clear that they must be passed on to consumers. The Competition and Markets Authority has also been clear to retailers that this is the expectation.

[Lord Rooker (Lab)]

Given that we still have many social security benefits based on contributions, can the Minister explain how taking people out of being able to pay the national insurance contributions does not, in the medium and long-term, affect their right to contributory benefits?

[Baroness Penn (Con)]

I can reassure the noble Lord that the threshold at which the tax is paid is different from that at which the credits towards contributory benefits are earned, so increasing the threshold where people are paying the tax has not affected their ability to accrue those rights.