Calls for government to scrap next month’s NIC increase

MPs this week accepted a non-binding motion calling on the government to scrap the National Insurance Contribution increase, due to come in next month, online news service inews.co.uk has reported.

The Labour motion, put forward during an Opposition Day debate, was passed without a formal vote – but it was symbolic, and the government is not obliged to act on it.

According to inews.co.uk, Treasury minister Lucy Frazer insisted the government “must and we will press ahead” with the tax increase in April.“Introducing the levy has been tough but it has been a responsible choice, which is what good government is all about,” she said, as quoted by the online news service.

Labour shadow chancellor Rachel Reeves had said the debate was an opportunity for the government to show “they don’t want to make the cost-of -living crisis even worse than it already is”.

Reeves called on ministers to cancel the tax hike, as she argued what is happening in Ukraine will have a “cost of living effect here at home, too”, inews.co.uk reported.

She urged chancellor Rishi Sunak to use his Spring Budget this month to announce he was scrapping the plans, the news service said.

“The chancellor must show some understanding of the real-world consequences of his policies, on working people and on businesses,” she said.

The Spring Budget will take place on 23 March. “If the government can’t commit to halting the National Insurance rise today, they must make it then,” the news service quoted Reeves as saying.

From April, NI is set to increase by 1.25 percentage points.

Read about preparing for the NI increase in the March-April issue of Recruiter.

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