Working OAPs will escape National Insurance tax grab at Budget to help fill £22bn black hole, says Rachel Reeves

WORKING pensioners will escape being clobbered by a National Insurance tax grab at the Budget to help fill a £22billion black hole, Rachel Reeves says.

The Chancellor ruled out bringing them into line with other workers — putting paid to calls for them to make a contribution to cover care costs.

AFP

It comes after the winter fuel allowance was stopped for ten million pensioners.

Speaking in New York, she played down speculation saying she told The Sun she had no plans to hit older workers with the tax.

It sends a clear message to the 800,000 who would have to pay £1billion if they were targeted.

A tax hit would be seen as a deterrent for older people, with 3.5 million over-50s out of jobs with illness or retirement.

Ms Reeves also said: “We don’t want to increase taxes on working people.

“And we will be keeping income tax, National insurance and value added tax at the rates they are for the duration of this Parliament.

“I would like taxes on working people to be lower but I believe that you can’t make promises without being able to say where the money is coming from.”

Her comments come after economist Sir Andrew Dilnot said pensioners should make NI contributions to cover the cost of social care.

He said: “I think if a government does decide to have a tax that is used explicitly to pay for social care in part, then it does seem reasonable to have pensioners covered by that tax, just as those of working age are.”

The Chancellor has told Parliament there is a £22billion financial black hole to fill after the Tories left office.

Meanwhile, Ms Reeves has appeared to leave open the option of raising capital gains tax as she attempts to generate revenue.

She said she would have to strike the “right balance” amid speculation she could target the wealthy with the levy.