Rachel Reeves has been warned she faces a legal challenge over her hike to National Insurance Contributions just hours before the measures come into effect tomorrow.
Private care homes have complained that the Labour Chancellor's tax raid - which includes a rise on employers' contributions - puts the entire care industry at risk of total collapse.
The NHS could "crumble" under the added pressure, providers argued, although the Treasury insisted that the extra tax was required to "rebuild public services".
Consequently, the industry body representing private care homes Care England has opted to take the Chancellor to court over the matter by launching a judicial review of the policy.
The Labour Chancellor has now been slapped with legal action
PA
Chief executive Professor Martin Green told The Telegraph: “This Judicial Review marks a critical moment for adult social care.
"The decision to increase National Insurance Contributions without exempting the care sector is a political signal that social care remains an afterthought.
“Successive Governments have reinforced a damaging divide between the NHS and social care through policy, legislation and funding.
“But the reality is clear – when social care crumbles, the NHS follows," he explained.
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Health charity Nuffield Trust found that around 18,000 care homes across England will have to swallow a £940million bill each year after Reeves' tax hikes take effect from April 6.
Tory analysis has indicated that the NHS could lose out on a whopping £1.7billion each year, which could have been deployed to solve the growing issue of staff shortages across the sector or relieve heavily-burdened frontline services.
Warning that adult social care was already being "pushed to the brink" by Labour, Green added: “We are standing up for a sector that has been routinely overlooked, and for the interconnected system of care that underpins the health and wellbeing of this country.”
He also said that the Government's actions were "being felt by millions".
The shadow health secretary blasted the impact of Labour's Budget on health services
GETTY
Chief financial officer NHS England Julian Kelly has warned that the NHS will be forced to take out of the extra £10.6billion which had been gifted to the health service in Reeves' October Budget.
Providing a damning indictment of Reeves' Budget, Tory business secretary Andrew Griffith said: "This week lays bare two of Labour’s worst blunders – failing to fix our US trade relationship and slamming businesses with a punishing jobs tax."
Meanwhile, shadow Health Secretary Edward Argar said: "Labour’s NICs jobs tax has piled more costs onto the NHS, meaning a huge amount of money that should have gone on improving frontline health services for patients, and recruiting more nurses and staff, is simply having to go straight back to the Treasury to pay for these tax hikes.
"With Labour, what they give with one hand they’re taking away with the other.
"Their choice to impose this tax hike on the NHS, as well as hospices, social care providers and charities, leaves them having to prioritise paying an increased tax bill, instead of being able to recruit additional frontline staff to care for patients."
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