Press Room
Mixed message for business as hike in national insurance
contribution offsets good news, says Grant Thornton
"Businesses will welcome the announcement not to raise the small
companies' corporation tax rate for a further year and the other
targeted measures that were announced, but this will be tempered
with the announcement of the increase in National Insurance
Contributions in 2011," says Paul Cooper, tax partner at Grant
Thornton.
"Chancellor Alistair Darling gave us a nasty surprise with the
announcement to raise NIC rates by a further 0.5% from April 2011
on top of the 0.5% increase announced at the 2008 pre-Budget
Report. This is effectively a tax on jobs. Businesses will have to
foot that bill unless employees accept a cut in their income."
"I am relieved that the Chancellor did not increase the Capital
Gains Tax at this point, but many entrepreneurs will continue to
worry about future hikes of CGT, given that CGT remains at 18% when
the top band of income tax is to be 50%."~
For further information please contact:
Alexander Wessendorff, Grant Thornton press office, 020 7728
2048