In particular FPB feels that the coalition’s planned national insurance policy will be better for small firms and for jobs.
The 1% hike in employers’ national insurance, that had been scheduled for 2011, will now be scrapped for many staff although it will remain in relation to staff earning more than £20,800.
However, the threshold at which businesses pay on NI on employees earning up to £20,800 has been raised by £21 per week. As as a result, says FPB, most businesses will be spared a large tax rise in return for retaining staff and recruiting new employees.
“Small businesses did not want this tax on jobs because clearly it would have been a major barrier to staff retention and job creation and would have hindered economic recovery,” said the Forum’s Chief executive Phil Orford . “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 NI is far better and provides a degree of certainty for business growth now and in the future."
