The plan is to increase National Insurance by 1.25% for employers and the same percentage for employees totaling an increase of 2.5%.
With the cost of living rising since early 2021, December reached the highest recorded level in decades this is not a welcomed increase.
Yesterday, The House of Commons called for the Government to replace the proposed National Insurance increase with taxes on the wealth of the richest. This motion has been signed by 21 members and no amendments have been submitted as yet.
APSCo (Association of Professional Staffing Companies) have written to the Chancellor, Rishi Sunak, to highlight concerns surrounding the increase. They do not believe it is the right time as the increase will penalise workers and effect businesses and therefore asking the Government to delay the change.
Despite these efforts to propose a delay it is reported Sajid Javid has said the £12 Billion Tax Levy for NHS remains ‘secured’. Mr Javid insisted the National Insurance hike — which will strip the average family of £600 a year — was not ‘under threat’.
He re-iterated his support for the increase, which will bring in an extra funds for the NHS and social care.
Yesterday, former Brexit Chief, Lord Frost, weighed into the argument, claiming that the Government should abandon the plan because it was ‘not needed’.
The national insurance rise will cost a worker on a £30,000 salary around £255 over a year – and £505 for anyone earning £50,000.
Whilst we are keen to ensure our clients have updated information and figures for the new Tax year as early as possible, we remain hopeful that the Government will consider delaying this increase whilst the economy continues to recover from the pandemic.
Follow us on LinkedIn for regular updates on industry news when they are released.