Chancellor ditches national insurance hikes for self-employed
Following widespread criticism that the proposed move had broken a Conservative party manifesto pledge, Philip Hammond announced the policy U-turn in a letter to MPs.
“In light of what has emerged as a clear view among colleagues and a significant section of the public, I have decided not to proceed with the Class 4 NICs measures set out in the Budget. There will be no increases in NICs rates in this parliament,” he wrote.
The now defunct proposals would have led to increases in NICs for self-employed people from the current 9% to 10% in April 2018 and 11% in April 2019.
U-turn very welcome
Both the British Beer & Pub Association (BBPA) and British Institute of Innkeepers (BII) have reacted positively to the Chancellor’s change of mind.
Brigid Simmonds, chief executive of the BBPA, said: “This is a great result for those licensees who are self-employed, as the NICs rise would have seen them shoulder an increased tax burden.
“It is absolutely vital, however, that going forward, the chancellor does not seek to recover any of the £2bn in lost revenues from our sector, as we are already dealing with huge increases in taxes and costs this year, especially from the rise in beer duty in the Budget.”
The chief executive of the BII Mike Clist added that it was a welcome change of heart at a time when pubs need all the help they can get.
“We’re pleased that this change in direction will now mean that our members who would’ve been affected now won’t be, helping them and pubs at a time they really need it,” he said.
