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Business groups say no to proposed National Insurance increases
Added: 2010-03-19 10:17:36.0The proposed 1% increase in National Insurance Contributions has met some stiff opposition in the form of some of Britain’s major business groups. The coalition, formed to prevent the increase, boasts the leaders from groups such as the British Chambers of Commerce (BCC), Federation of Small Businesses (FSB), Institute of Directors (IOD) and the Chartered Institute of Personnel and Development (CiPD) to name but a few.
The increase, due to come into force in April 2011 means that employers would be liable for 1% extra in National Insurance Contributions. An online petition has been set up to urge the Government to scrap the increase. The petition reads:
“Businesses across the country know that it is imperative for the Government to begin the difficult job of repairing the public finances. But this NICs increase is a 'tax on jobs' - and will discourage companies of all sizes from taking on new staff at a critical point in our economic recovery.
We urge the Government to work with business groups to find alternative ways to close the UK's budget deficit - beginning with a credible plan to reduce inefficiency in public sector spending. Any Government has to realise that additional taxes on businesses, especially small- and medium-sized companies, must be a last resort, not an easy way forward.”
The coalition cite, amongst other things, a cost of £14bn to UK businesses and resulting loss of 57,000 jobs in small businesses as reasons why the increase should not go ahead.
“The respected and independent Institute for Fiscal Studies has commented that 'employer [NI] contributions bear no relation to benefits provided under the NI scheme. These contributions are in effect simply a payroll tax'. From our perspective, further rises in NI mean fewer jobs, more people signing on, and a slower recovery for UK plc”.
“The case is clear. No NICs increase - no tax on jobs.”
For a full run down on the reasoning behind the coalition’s petition, the petition can be viewed at http://www.no-nics-rise.co.uk/.
Were you aware of the 1% rise for employers? Will you be signing the petition? We want to hear from you, please enter your comments below
The content of this blog is not legal advice and should not be relied on as such, or used instead of seeking legal advice.
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