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LedgerGov.UK
← What each tax change raises

HMRC's estimate · edition published 24 Jun 2025

What 1p on employees' National Insurance raises

Employees pay National Insurance on their earnings at a main rate, 8% now, and a lower rate on earnings above an upper limit. This is what raising the main rate to 9% would raise. Employers' National Insurance is separate.

2026-27, the first year
£5.35bnSourcedHMRC direct effect of 1 point on the employee NICs main rate: 5.35bn in 2026-27, 5.4bn by 2028-29 (HMRC-DE-2025-06). Low–high is an editorial ±10% because HMRC publishes a central figure only. HMRC includes taxpayers' own behavioural response where it models one, but no wider economic effects.HMRC: Direct effects of illustrative tax changes
range £4.8bn to £5.9bn
2028-29, the last year HMRC shows
£5.4bnSourcedHMRC direct effect of 1 point on the employee NICs main rate: 5.35bn in 2026-27, 5.4bn by 2028-29 (HMRC-DE-2025-06). Low–high is an editorial ±10% because HMRC publishes a central figure only. HMRC includes taxpayers' own behavioural response where it models one, but no wider economic effects.HMRC: Direct effects of illustrative tax changes
range £4.9bn to £5.9bn

HMRC's caveat. Employees' main rate only. HMRC allows for people changing how much they earn or report, and says the size of that response is uncertain.

HMRC's figure is for a change either way, so a 1p cut would lose about as much.

Make this change in the sandboxThe sandbox shows what it does to borrowing, per household, prices and debt, each as a range.

Quote this

HMRC estimates that 1p on employees' National Insurance (8% to 9%) would raise £5.35bn in 2026-27 and £5.4bn in 2028-29. Source: HMRC, Direct effects of illustrative tax changes, edition published 24 Jun 2025. https://ledgergov.uk/tax/employee-national-insurance

Where this comes from

From HMRC's Direct effects of illustrative tax changes, the edition published 24 Jun 2025, the latest (on file as HMRC-DE-2025-06). HMRC's row: “Change Class 1 employee main rate by 1 percentage point”.

HMRC works out each figure for a change made at the start of 2026-27, on its own, on the official forecast of the time, and shows each year to 2028-29. It includes how taxpayers respond, where HMRC models it, but no wider effects on the economy. HMRC publishes one figure a year; we show a range of 10% either side of it, our usual band where a source gives none.

See how the numbers are made, or the Autumn Budget 2026 page.