In his Budget speech on 21st March 2007 (see col 827) the then Chancellor of the Exchequer, Gordon Brown, announced a proposal to "align the income tax system with the national insurance system" from April 2009, "thereby creating a tax system for income that has just two rates and two thresholds".

National Insurance Contributions Act 2008 gives effect to this proposal for tax years beginning April 2009. The Act has just 7 sections. Its purposes are:-

1. to enable alignment of the Upper Earnings Limit (UEL) for Class 1 NICs purposes with the point at which higher rate income tax becomes payable; and
   
2. to remove the primary Social Security legislation that restricts the maximum UEL to no more than seven and a half times the Primary Threshold (ie the point at which Class 1 NICs become payable on a person's earnings).