National Insurance alert: Reeves DODGES question over tax hike on millions - 'Unwelcome news!'

Ahead of July's General Election, Prime Minister Keir Starmer promised the British public that the Labour Party would not hike taxes on "working people" if it returned to power.

However, this promise has come under scrutiny as to who would be considered "working people" under the Reeves regime.

During an interview with Andrew Marr on The New Statesman's NS Podcast, the Chancellor claimed Labour will stand by its manifesto pledges when it comes to taxes.

She shared: "We have to set out the full package at the Budget. In the manifesto, we made that commitment to not raise taxes on working people.

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"Despite the fact that the inheritance, the £22billion 'black hole' is much worse than we could have ever anticipated, we are not going to break out manifesto commitment."

When pushed by Marr over whether this pledge extends to National Insurance contributions for everyone, including employers, the Chancellor said the commitment was reserved for "working people".

Reeves added: "Our manifesto was very clear: we will not raise taxes on working people.That means their National Insurance, basis/high/additional rates of income tax and VAT. Those stand."

Marr noted that this would not include raising National Insurance contributions on employers but the Chancellor stated the UK could not take "another five years of austerity".

The National Insurance rate is currently eight per cent for 27 million workers after dropping from 12 per per cent in January 2024.

Under the last Conservative Government, the former Chancellor Jeremy Hunt claimed his party had saved the average worker on £35,000 around £900

For those who are self-employed and pay class 4 National Insurance contributions, their tax rate is six per cent if they earn between £12,570 and £50,270.

On average, employers have to pay a 13.8 per cent contribution on any worker earnings surpassing the second threshold which is at £175 per week or £758 a month.

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David Lane, the chief executive of TPT Retirement Solutions, said: "If the Government adds National Insurance to employer pension contributions, it would be unwelcome news for both employers and pension savers.

"This tax could lead to some employers cutting back on contributions if they are paying more than the legal minimum. It could also discourage other firms from being more generous with employee pensions."

Reeves also rejected the idea that Britain's wealthiest residents will leave the UK following changes to non-dom tax rules. If you make Britain your home, you should pay your taxes here – and under this Government, you will."

The Chancellor also declined to rule out introducing taxes pensions next week.

A UK Government spokesperson told GB News: "We do not comment on speculation around tax changes outside of fiscal events."