A senior Tory has accepted the rise in National Insurance will be unpopular with voters as Boris Johnson doubled down on the planned hike.
Foreign Secretary Liz Truss admitted "taxes are never popular" as she defended the Government's plan for a manifesto-busting tax rise in April.
The Prime Minister has been under pressure from his own backbenchers to ditch plans to for workers, employers and the self-employed to pay 1.25p more in the pound for National Insurance from April 2022 for a year.
The £12bn a year hike, which was announced last year, will raise cash to tackle Covid backlogs in the NHS and fund social care.
But it comes as families face a cost of living crisis, with bills expected to soar when the energy price cap rises.
Mr Johnson was reportedly wavering over the decision this week amid fury over the Downing Street partygate saga.
But in a joint article with Chancellor Rishi Sunak today, he double down on the plans - despite the pair claiming to be "tax-cutting Conservatives" and "Thatcherites".
Reports also suggested that plans to cut VAT on fuel had been abandoned - despite looming rises in energy bills.
Ms Truss told the BBC : "We are in a very difficult situation. We have spent a lot of money on the Covid crisis, which had public support, whether that was the furlough scheme, whether it was the business support scheme and the reality is we do need to pay this money back."
She acknowledged that "taxes are never popular" but argued that "significant" amounts of money spent coping with Covid must be repaid.
"As soon as possible, we want to be in a position to lower our tax rates, we want to drive economic growth, because ultimately that is what will make our country successful," she said.
"But we do face a short-term issue, which is that we have spent significant amounts of money dealing with the Covid crisis that does need to be paid back."
But unrest remains among Conservative MPs, with senior backbencher Robert Halfon urging the Government to "go back to the drawing board".
He told Sky News that people were "facing a real struggle to feed their families and pay for the cost of clothing and the cost of living."
Mr Halfon said: "I have suggested that the Government looks at windfall taxes on big business, particularly oil companies for example who have been raking it in over the past couple of years, to perhaps increase capital gains tax as well - so that we can raise those funds for the NHS without hitting low-income workers."
Labour 's Lisa Nandy warned "it's just simply not possible for a lot of people to survive" if their tax burden grows.
She urged the Government to "rethink" the National Insurance rise, adding Labour would "come forward with a much fairer taxation system".
Asked if Labour would repeal the planned tax hike, the Shadow Levelling Up Secretary said: "We're hoping that the Government won't go ahead with it.
"Well, look - we wouldn't bring it in in the first place, let me be absolutely clear with you if there was a Labour government today there would be no rise in National Insurance, people would not be facing the prospect of seeing their incomes squeezed even more."
But Paul Johnson, director of the Institute for Fiscal Studies, said the pandemic had given ministers an opportunity to smuggle in a big tax rise needed to cover the "long-term ever-growing costs" of the NHS.
Mr Johnson told Times Radio: "Even if we hadn't had a pandemic and even if the Government wasn't doing anything about social care, they would still have needed a rise of something like this because spending on the NHS is just rising inexorably year on year on year.
"In a way, my view is that the pandemic has given them an excuse to smuggle in the rather big tax rise that they would have had to do in any case."
