UK PM Johnson unveils new tax to fund health, social care costs

London: British Prime Minister Boris Johnson on Tuesday unveiled a new tax that will fund the country's mounting health and social care costs in the wake of the COVID-19 pandemic.

A new UK-wide 1.25 per cent health and social care levy from April 2022 will begin as a hike in the compulsory National Insurance (NI) contributions by taxpayers, a move that breaks Johnson's election manifesto pledge to not hike taxes.

However, he defended his so-called social care package as the "biggest catch-up programme" for the state-funded National Health Service (NHS) and pointed out that the pandemic had rendered the manifesto pledge impossible.

No Conservative government ever wants to raise taxes, and I will be honest with the House, I accept yes I accept this breaks a manifesto commitment, which is not something I do lightly, said Johnson in his statement to the House of Commons to announce the plans.

But a global pandemic was in no-one's manifesto. I think the people in this country understand that in their bones and they can see the enormous debts this government/ the Treasury has taken, he said.

The plan, to be voted on in Parliament later this week, was signed off by ministers at a Cabinet meeting earlier on Tuesday and came after days of anger from Conservative Party backbenchers opposed to tax rises.

The 1.25 percentage point increase is expected to raise about 12 billion pounds which, in the early years, will mainly be used to fund dealing with the NHS.

The new Health and Social Care Levy is the necessary and responsible thing to do to protect the NHS, sharing the cost between businesses and individuals and ensuring those earning more pay more, said UK Chancellor Rishi Sunak, one of the key ministers behind formulating the plans.