Businesses to benefit from National Insurance tax break
Tax burden a 'serious issue' for start-ups
Business start-ups in the UK could benefit from national insurance (NI) ‘holiday’ on employers NI contributions
The launch of the government’s ‘Regional Employer NICs Holiday for New Businesses’ scheme would see small businesses outside of London and the South East receive a NI tax break for the first 10 employees hired in the first years of business. The break would last for the first 52 weeks of employment.
The Forum of Private Business (FPB) has welcomed the news, saying that this will help ease the burden on small businesses after years of increasing taxation. However, they also say that the government needs to introduce further measures to help businesses.
Chief Executive Phil Orford said “However, if the Government is serious about creating conditions for real economic recovery based on strong small business growth, it needs to introduce even bolder tax policies.”
According to the Forum’s Tax and Budget member panel, more than two-thirds of small and medium business owners believe the tax burden placed on them in unfair. 45% of respondents to a recent survey said their tax burden was a ‘very serious’ issue for their firms.
In addition, 13% of owners said they want to see the tax system reformed to make the UK more competitive internationally.
The scheme is open to new businesses set up on or after 22 June 2010 and will run until September 2013.
Orford added: “Given the significant threats to cash flow and business growth from issues such as a lack of bank finance and increasing late payments, recruitment is likely to be slow during the first 12 months for many new firms. The scheme should be available for a longer period than just the first year they are in business.”