NORTHUMBERLAND residents will see a £900 boost to their payslips this month.

This week, workers in Tynedale received a boost to their monthly payslips as the second cut to National Insurance Contributions (NICs) comes into effect.  

The Chancellor announced at the recent Spring Budget that the main rate of National Insurance would be cut on April 6 by 2 percentage points, from 10 per cent to 8 per cent. This means that taken together with the 2 per cent cut in the Autumn Budget last year, the average worker will be over £900 better off as a result of the tax changes. 

Since Autumn 2023, National Insurance has been slashed by one third - representing the largest tax cut to NICs in history, and meaning that the average worker in Northumberland now pays less in personal taxation than any other G7 major economy. 

In addition to changes to the main rate of National Insurance Contributions, over 2 million self-employed people will benefit from the main rate of Class 4 NICs being cut from 9% to 6% alongside the abolition of the requirement to pay Class 2 NICS - simplifying the tax system and saving an average self-employed person on £28,000 over £650 a year. 

It is expected that the tax cuts will also help grow the economy by bringing more people into the labour market. The Office for Budget Responsibility (OBR) forecasts that, as a result of these combined cuts, total hours worked will increase by the equivalent of almost 200,000 full-time workers by 2028-29.

To mark the record cuts to NICS, HMRC has launched an updated online tool to help people understand how much they will save in National Insurance this year: https://www.tax.service.gov.uk/estimate-apr-24-nic-changes 

 Guy Opperman MP said: "This week, hard workers in Tynedale received a welcome boost to their monthly pay packet as a result of the Government slashing personal taxation. 

"It is absolutely right that as the economy recovers, the Government rewards hard work through tax cuts. The average worker in Tynedale will be £900 a year better off as a result of these tax cuts. 

"I know that households have had a tough time as we have all experienced a higher cost of living, but the overall economic picture is improving - inflation is down from its peak of over 11% to 3.2% , wages are rising, and the financial burden on families is easing. As we turn a corner as a country, is extremely welcome that the Government now focuses on cutting tax for hardworking local people."