HCS Business Matters
12 May 2010
New Prime Minister- What Does This Mean For Businesses?
Now that David Cameron has been confirmed as the country’s new Prime Minister, we can start to consider what will be the effect of the new coalition Government policies on employers. As always, HCS will keep in touch with developments and bring them to you with our usual guidance and practical “how to” tips.
But in the meantime, George Osborne, Chancellor has promised that he would overturn the planned 1p in the pound rise on both staff and employers’ NI contributions which had been due to be introduced next April under Labour. His reasoning was that this move would threaten jobs and put the economic recovery at risk. He felt that the then Government’s proposal to increase national insurance, essentially placing an additional tax on jobs, came at exactly the wrong time in the economic cycle.
Mr Osborne said that £12 billion would be found from efficiency savings instead and that half of that amount would go towards ensuring that those earning less than £45,000 did not have to pay more National Insurance. The 1p NI rise on people earning more than £20,000 announced by the then Chancellor Alistair Darling in 2008 and 2009 was due to come into effect in April 2011.
Mr Osborne said his change in NI would save taxpayers earning between £7,100 and £45,400 up to £150 a year and will save employers money in reduced contributions.
12 May 2010, webeditor
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