A National Insurance cut has taken effect, with the government stating the average wage earner will save around £450 a year.

The cut from 12% to 10% was announced in November by Chancellor Jeremy Hunt in the Autumn Statement.

The UK Government said it will give workers “more money in their pocket”.

The cut means someone with a UK average wage of £35,400 will pay £450 less in NI over the year.

Rishi Sunak, Prime Minister, said it will help millions of people.

The Gazette:

He said: “We have made tough decisions on the economy, supporting people through global shocks such as the pandemic and Putin’s illegal invasion of Ukraine.

"It is because of the tough decisions this government has taken that today we are able to cut taxes for 27 million people across the UK.

“The tax cuts will directly reward hard working people, putting £450 back in the pocket of the average worker and helping them make ends meet.”

While much of Income Tax is devolved to the Scottish Parliament, National Insurance is reserved to the Westminster government, meaning the cut applies across the UK.

Jeremy Hunt, the Chancellor, said: “With inflation halved, we’ve turned a corner and are cutting taxes, starting with the record cut to National Insurance worth nearly £1,000 for a household.

“From nurses and brickies, to cleaners and butchers, 27 million hard-working Brits will have a little more cash in their pockets.”

The Gazette:

An online tool to see how much you will save has been launched.

The tool will use salary information to give employees personalised estimates of how much they could save because of the government’s changes, and will be hosted on the government’s cost of living support website on gov.uk.

The tool can be accessed here.