What is a direct effect of raising National Insurance contributions and creating a social care levy?

What is a direct effect of raising National Insurance contributions and creating a social care levy?

• A. More money for NHS and social care in the long term
• B. Immediate tax cuts
• C. Decreased revenue
• D. No effect

Answer: (C)

Raising National Insurance contributions alongside a social care levy creates a dedicated funding stream for NHS and social care, so the direct outcome is more resources for those services over time. National Insurance is a tax on earnings, so increasing it increases government revenue. The added levy specifies funds are earmarked for social care, giving a stable, long-term source of finance for those areas. This isn’t about cutting taxes or producing no effect; the intended result is stronger funding for health and social care, even though households may see lower take-home pay in the short term.

Raising National Insurance contributions alongside a social care levy creates a dedicated funding stream for NHS and social care, so the direct outcome is more resources for those services over time. National Insurance is a tax on earnings, so increasing it increases government revenue. The added levy specifies funds are earmarked for social care, giving a stable, long-term source of finance for those areas. This isn’t about cutting taxes or producing no effect; the intended result is stronger funding for health and social care, even though households may see lower take-home pay in the short term.