People over 40 would have to pay more tax or national insurance in order to meet their later life care costs under plans being considered by the government.
The plans are being considered by the government’s Health and Social Care Taskforce and the Department of Health and Social Care, The Guardian revealed.
Health and Social Care Secretary Matt Hancock is believed to be a proponent of the plan, which is similar to schemes already in place in Germany and Japan.
Less than one in five people said they believed the PM would implement social care reforms in the current Parliament in a recent poll.
Steven Cameron, Pensions Director at financial services provider, Aegon, said: “The COVID-19 pandemic has made it even more imperative that we solve the social care funding crisis. Finding a fair and sustainable solution will inevitably involve a sharing of costs between the state and individuals, based on their wealth or income. Introducing an additional band of income tax or National Insurance ringfenced to go towards social care costs is worth exploring and would mean those on higher earnings pay more into the fund.
“Applying the new tax to those above say age 40 may raise questions over intergenerational fairness and the government needs to look at the wider support it is offering for each age group. While paying more tax is not going to appeal to everyone, homeowners might see it as a price well worth paying if it came with a cross-party lifelong guarantee that in return they will not have to sell their home to pay for future social care.”