Prices To Rise Because Of Tax And Wage Hikes....

[ToraToraTora]

https://www.bbc.co.uk/news/articles/c0j10420e2jo

....who'd have thunk it! Get ready for high inflation followed by high interest rates. Good ole traditional Labour eh?

[barry1010]

I've said it before. No government has ever angered me so quickly. 

 

[youngmafbog]

Anyone with basic economic skill knew this would happen once that rediculous budget was announced.

And here we are.

[New Judge]

“A Treasury spokesperson said the Budget delivered stability for business and more than half of employers would either see a cut or no change in their NI bills.”

That is almost certainly true. 

Only employers with a very small number of staff and who pay them a very low salary will see either no change or a cut to their NI bill. An employer paying minimum wage for a 30 hour week (roughly £17,800pa at present and £19,000pa from next April) will have to have six or fewer employees to see his NI bill either remain the same or reduce – provided, that is, he doesn’t award them a further  pay rise.

But the UK has an enormous number of very small businesses. There are about 1.45m businesses which employ one or more people registered in the UK. But about 1.25m (more than 85%)  of them employ fewer than 10 people. So those with six or less employees on low pay will indeed see a cut to their NI bill and they almost certainly make up more than 50% of the registered companies in the country.

But the sums involved for each of these employers is very low. My fictitious company above will see a reduction of about £100 (from a current total of £2,200) on their NI bill.

In my view the group of employers who are most vulnerable to this rise are the not-so-small but still quite small enterprises of between 10 and 100 staff. There are around 250,000 of these employing over 6m people. 

If you examine a company employing 50 staff with average salaries of £25,000, its NI bill will increase by fully one third, from £104k to £139k. That’s an increase of £700 for each person they employ, taken straight off the business’s bottom line. That’s considerably different to the savings of twenty or thirty quid a head my micro business will save.

So, for those thinking the NI issue is a lot of fuss about nothing, what do you expect my small business of 50 staff (and the rest of the quarter of a million like it) will do to cope with this assault on their bottom line? Are they going to expand to contribute to the growth Rachael from Complaints and her boss thinks her budget will secure, when every new person they take on costs them three grand in NI contributions?

[ToraToraTora]

"my small business of 50 staff" - You are an employer judge? Then you must be a rich B'stard getting rich on the backs of the poor. How dare you give people jobs and contribute to the treasury! You must be punished! 😉

[douglas9401]

Oh dear.

[New Judge]

Sorry. My hypothetical company, Tora !!!

I would not run a company in this country for all the tea in China. Apart from being unpaid tax collectors on a massive scale, companies are hidebound by regulation and red tape (which is set to get worse) to such a degree that I wonder how any of them manage to turn a profit.

[gingejbee]

Dreadful news...Next to put up prices this year by ONE per cent.