Budget rumour - Employer NI to be hiked

This rumour has a ring of truth about it. It's the sort of insidious, short-termist tax policy favoured by politicians, Tory and Labour alike. Voters won't feel the impact right away and will struggle to understand the mechanics behind it. It won't affect existing pensioners but will make saving for retirement just that little bit harder for the working population. With the ongoing cost of living pressures, some employees may decide it's not worth the bother and will opt out of pension saving altogether—and who could blame them when the goalposts keep shifting? Small businesses, in particular, may question whether there are more cost-effective ways to motivate their workforce. As ever, the elephant in the room will be how this affects the public sector, whose pensions are typically funded more generously than their private sector counterparts. This may yet prove to be the fly in the ointment that saves us all from a poorer retirement.

Charities are being squeezed from all directions. The cost of employing people is rising beyond what we can manage, funding is harder to find and people need more help than ever. At Incredible Kids we are finding this increasingly difficult to juggle in our pursuit to support disabled children.

As the director of a growing business, I understand the need for the government to raise revenue, but a national insurance levy on employer pension contributions would add to the rising costs we're already managing. We've experienced good growth this year and are looking to expand our team, but increased taxes could slow down that momentum as we assess the impact. More than anything, we need clarity from the chancellor on what's coming so we can focus on driving the business forward without constant uncertainty.

A stealth tax on hard working families. Anyone who states that employer NI contributions do not effect workers is either naive or lying. Raising the cost of employing staff will result in job losses, fewer vacancies, potentially business failures and ultimately lower wages for many as the money used to pay the Government will come from the same pot used to provide pay rises to staff.
Any increase in tax take will be far smaller than expected due to this, we can also expect to see an increase in self-employed roles as more and more employers look to contract work out. Accountants expect an increase in IR35 enquiries in the near future!

An increase to National Insurance only adds to the financial pressures that many small businesses have been subjected to in recent times.

Recruitment is one area that could potentially be impacted, not only has this been a major challenge for businesses in recent years, this possible increase will only add to the overall cost of recruitment which may discourage some from hiring.

Equally, if businesses cannot absorb these rumoured increases, employees might face slower wage growth or fewer benefits as businesses tighten their belts accordingly.

The increase in employers' NI along with workers getting day-one rights could encourage more employers to want to utilise the self-employed rather than employing people. Employers could also push people into umbrella companies which are still an unregulated sector.

Labour has long been a voice of the worker but, putting too much pressure on the employer is inadvisable and there could be disastrous consequences.

The honeymoon period is well and truly over for Kier Starmer. His party’s policies and intentions are very clear. Far from creating growth, this is another example of fiscal failure on a grand scale. There’s no joined-up thinking and no long term plan to keep the Great in Britain. Small and medium sized enterprises create much needed jobs and it’s hard to see how they will survive, let alone thrive on the back of yet another raid on their cash. Current policies have disincentivised and disadvantaged savers, investors, pensioners and business owners. It leaves one to wonder how low can we go?

A tax on employers is a tax on the “working man.”

If an employer has an increase in costs that is a “black hole” in the business finances.

If employment costs go up, a business has a few choices. The easiest of which will be to increase prices for their product or services to make extra money. This is a tax on everyone, it's called inflation.