Belfast Telegraph

Jobs hit as firms feel pinch from tax rises

Small businesses are keen to grow and take on more staff but rising National Insurance is preventing them from doing so, a business organisation claimed.

With employment statistics due today expected to show a rise in unemployment, over half of small businesses surveyed by the Federation of Small Businesses (FSB)-ICM panel said UK taxes prevent-ed them taking on more staff.

The FSB said that a temporary boost to employment figures from the Christmas season would also be coming to an end, compounding the pressure on unemployment figures.

National Insurance is set to go up by 0.5% more than previously planned in 2011.

“The FSB is stepping up its call to Government to freeze National Insurance contributions and provide a National Insurance rebate for small businesses with fewer than 50 staff that take on more employees during 2010-11.”

Late last year, the FSB-ICM Voice of Small Business annual survey showed that just under one fifth of small businesses would take on new staff in the next 12 months, with Northern Ireland businesses among those more likely to do so.

Wilfred Mitchell, policy chair of the FSB, said: “The January employment figures showed a welcome fall in the number of people out of work but we fear the severity of the recession will begin to be evident when the latest figures are released.

“What the UK economy needs is real action to get more people into work, especially under-25s, who make up a large proportion of those currently unemployed.

“A cut in National Insurance contributions would encourage small businesses to take on more staff and grow their business,” said Mr Mitchell.

Belfast Telegraph