Boris Johnson Taxes the Young To Pay for the Old
The most successful prime minister in the post–World War II United Kingdom turned the country around by, as she put it, “rolling back the frontiers of the state.” That was Margaret Thatcher, and if it wasn’t already clear that Prime Minister Boris Johnson is engaged in a very different project from the Iron Lady, confirmation came last week in the form of an announcement on health and social care.
Johnson has created a new taxpayer-funded entitlement to social care (residential care, in-home health care, and other forms of assistance for the elderly and infirm) and has boosted funding for the National Health Service (NHS), Britain’s taxpayer-funded, free-at-the-point-of-use health care system. Under the new system, care will be subsidized for anyone with assets up to $170,000. No one, however wealthy he may be, will ever have to pay more than $120,000 on care over his lifetime. Once that threshold has been reached, taxpayers will foot the rest of the bill.
To pay for all of this, Johnson is squeezing another $16.5 billion out of U.K. workers by imposing a 2.5 percentage point increase on the total payroll tax (1.25 percent from an employee and 1.25 percent from the employer)*. A tax on shareholder dividends will also rise by 1.25 percentage points. In doing so, Johnson is breaking an election promise not to raise taxes and confirming that the days of small-state conservatism are long gone. After the changes come into effect, the U.K. will have the highest tax burden since 1950. When the only higher-tax post-war government than Johnson’s was the radical, industry-nationalizing administration of Clement Attlee, you know something, somewhere, has gone very wrong with the U.K.’s Conservatives.
But few expect even this substantial rise to come close to paying for the full set of promises of care Johnson has made. As the nonp
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