Budget: Jeremy Hunt is expected to announce a 2p cut to National Insurance

Jeremy Hunt is expected to announce a 2p cut in National Insurance when he delivers his Budget on Wednesday.

Mr Hunt is under pressure, particularly from Tory MPs, to cut taxes, which are currently at historic highs.

Labor said any cuts would be nullified by the government's previous decision to freeze the thresholds at which people start paying tax.

This move means that wage increases are more likely to drag someone into a higher group so they pay more tax.

National Insurance contributions are paid by employees and the self-employed on their income, as well as by employers.

The amount paid depends on the salary of the individual.

As the key rate was cut from 12% to 10% during the autumn report, the focus of Wednesday's cut is expected to be on workers rather than employers.

For someone on a full-time salary of £35,000 a further 2p cut would be worth £450 a year.

In his Budget speech in the House of Commons on Wednesday, Mr Hunt could argue that the government is motivated to reward work and put more money in people's pockets.

However, this comes against a backdrop of sluggish economic growth, with the country falling into recession late last year.

In recent weeks, the president has stressed that his intention to cut taxes is not what he expected, following a rise in borrowing costs.

Cutting National Insurance is cheaper than cutting income tax; However, some Conservative MPs fear it is not well understood by many voters and will therefore be less politically effective.

They also argued that the initial cuts to National Insurance did not improve the Conservatives' political fortunes – a key issue in this year's expected general election.

Labor believes the government has more room for maneuver than ministers are suggesting and may even cut income tax.

Labor leader Sir Keir Starmer said in his Budget response that the tax cuts were still making people worse off because tax caps were frozen and many people were paying higher rates of tax than before.

Along with expected cuts to National Insurance, Mr Hunt is set to freeze fuel duty for another year. Tax has not been increased since 2011.

The BBC has also been told that Mr Hunt will use his budget to urge councils to cut spending on diversity programs and consultants.

It comes as councils across the country say they are struggling to balance the books.

Councils in Birmingham and Nottingham have announced major cuts to services this week.

Local councils have dismissed attacks on diversity programs as a “concern”.

People with non-resident status are UK residents who are based abroad for tax purposes. Under the current system, they don't have to pay UK tax on money they earn overseas.

Labor has promised to abolish non-dom status and spend the money on schools and the NHS.

If the party supports any tax cuts the president announces, they are expected to do so, raising questions about how some of their spending pledges will be financed.