SMEs hit out against NI hikes
Dec 10 2009
Darling announces a 0.5 per cent increase in NI
The Chancellor’s decision to increase national insurance contributions by a further 0.5 per cent in April 2011 has angered small business owners.
Juliet Davenport, CEO of renewable energy company Good Energy, says: ‘The national insurance increase is a big negative because it's an incentive to reduce overheads in terms of the number of people you have, which is a shame when the goal is to get people back to work.’
Phil Orford, chief executive of the Forum of Private Business, believes the tax increase will come at the worst possible time for small firms. ‘This will be just at the point where, hopefully, the economy will be in recovery and they will be looking into taking on new staff. Putting a tax on employment isn’t the way to reduce the public debt.’
However, businesses welcomed plans to delay the 1p increase in corporation tax for profits under £300,000, an extension in empty property rate relief for properties of a rateable value of £18,000 and continuing the “time to pay” scheme, which allows companies more flexibility in paying tax bills.
Martin Hesketh, managing director of accountancy firm Brookson, says: ‘There were some useful measures, but the increase in national insurance contributions was not helpful and it was disappointing to see VAT go up. I’m concerned the Chancellor’s books don’t balance as he didn’t include any detail about the spending restraints needed.’
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