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  •  Fiscal policy, labour markets, market failure

Click to read the article below and then answer the questions:

Who are the winners and losers from the UK’s £12bn social care tax raid?

  • Outline the changes which will be applied to National Insurance Contributions (NICs), the so-called Health and Social Care Levy, from April 2022.

  • As a result of the changes to NICs, how much NICs will employees pay if their income is:

    a. Less than £9,568;

    b. Between £9,658 and £50,270; and

    c. Greater than £50,270.

  • Explain how freezing personal allowances from 2022 will also increase the government’s tax take —

  • Using a labour market diagram(s), analyse the potential unintended consequences of the ‘two tax hikes.’

Gavin Clarke, Emmanuel College

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