Scrapping the planned one per cent rise in employers' National Insurance Contributions (NICs) should prove to be a big help to small businesses and the economy, it has been claimed by APA today. With other major business organisations APA has been actively campaigning for months to have this increase, announced at the last Budget for introduction in 2011, overturned.
APA has backed the new coalition government's plan to abandon the Labour policy introduced at the last Budget and due for implementation in 2011. Although the one per cent employers' NICs rise will still affect staff earning more than £20,800, the threshold at which they begin paying NI on employees earning up to that figure will increase by £21 per week. But since the majority of small business employees will now be excluded from the increase, hopes are high that recruitment activity will pick up in the sector.
Gareth commented: "Small businesses did not want this extra tax, it would have been a major barrier to staff retention and job creation and would have hindered economic recovery. For the majority of employers it would have proved to be an unpopular and unworkable tax rise. Although not perfect, the new coalition government's policy on NICs is far better and provides a degree of certainty for business growth now and in the future."
According to research conducted by the Forum for Private Business (FPB), 60.8 per cent of small business owners believe the new government should make tax simplification a priority.
APA has backed the new coalition government's plan to abandon the Labour policy introduced at the last Budget and due for implementation in 2011. Although the one per cent employers' NICs rise will still affect staff earning more than £20,800, the threshold at which they begin paying NI on employees earning up to that figure will increase by £21 per week. But since the majority of small business employees will now be excluded from the increase, hopes are high that recruitment activity will pick up in the sector.
Gareth commented: "Small businesses did not want this extra tax, it would have been a major barrier to staff retention and job creation and would have hindered economic recovery. For the majority of employers it would have proved to be an unpopular and unworkable tax rise. Although not perfect, the new coalition government's policy on NICs is far better and provides a degree of certainty for business growth now and in the future."
According to research conducted by the Forum for Private Business (FPB), 60.8 per cent of small business owners believe the new government should make tax simplification a priority.
APA
2 comments:
I congratulate the APA for their campaigning and am delighted for employers - it's a shame that employees will still have to pay the increase.
Tracy, you are quite right as usual and that is our new challenge. Any additional tax on employment, especially for employees is tough to bear. APA would prefer to see an increase in VAT; you can make a choice as to whether you buy goods and services but you have to earn first to spend.
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