National Insurance Changes ‘ease burden on strivers’
The FSB warmly welcomed the changes to National Insurance Contributions (NICs) announced by Chancellor Jeremy Hunt, indicating that the alteration will play a pivotal role in ‘easing the burden on strivers up and down the country.’
In response to the recent Autumn Statement, the Federation of Small Businesses (FSB) emphasised that:
“Small businesses – and the 16 million people who work for them – are the route to future growth that will raise living standards across the whole country.”
What do the cuts to NIC rates include?
Mr. Hunt used his Autumn Statement speech to cut the main rate of employee NICs from 12% to 10% for 27 million workers across the UK. This is set to take effect on January 6, 2024.
The Chancellor said that, for the average employee earning £35,400 per year, the change amounts to a £450 annual tax cut.
For the self-employed, the Chancellor also abolished Class 2 NICs and cut Class 4 NICs from 9% to 8%, effective April 6, 2024.
Tina McKenzie, Policy Chair at the FSB, said:
“The UK’s four million self-employed people play a hugely important role in the labour market and in building growth across the whole economy.
‘The Chancellor’s decision to reduce the rate of self-employed NICs and abolish the Class 2 element is extremely welcome, easing the burden on strivers up and down the country.
‘The FSB has long campaigned for the abolition of the Class 2 element of NICs and the reduction of Class 4, and we are therefore pleased that the Chancellor has acted.’
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Internet links: GOV.UK and the FSB website
