Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what the cost would be in the next financial year of raising the threshold at which people begin paying national insurance contributions (NICs) to £11,500; and how many employees would pay no tax or NICs in the event of that threshold being changed.

HM Treasury does not keep this information in the form requested. However, based on HM Revenue and Customs’ ‘Direct Effects of Illustrative Tax Changes’, a published document, the approximate costs to the Exchequer in 2017-18 would be:

• Increasing the primary NICs threshold to £11,500 would cost approximately £15bn a year;

• Increasing the secondary NICs threshold to £11,500 would cost approximately £16bn a year; and

• Increasing the Lower Profits Limit for Class 4 NICs to £11,500 would cost approximately £1bn a year.

  The total annual cost to the Exchequer of increasing all three thresholds to £11,500 would on this basis be approximately £32bn. These are approximate estimates, and in any case do not take into account the secondary effects of behavioural changes after an increase to the threshold.

  HM Treasury has not made an assessment of how many employees would pay no tax or NICs as a result of this.