A tax hike for forgotten self-employed would be 'unfair'

by Susie Hughes at 14:13 07/09/20 (News on Business)

Fears are rising that the Government could raise Corporation Tax and National Insurance Contributions to pay for partial support during Covid.

Self-employed and freelancer group, IPSE, has argued that making the 1.5 million 'forgotten' self-employed pay for support they did not get would be 'unfair, unjust, uneconomical - and unbelievable'.. It has also said that given the slump in the number of self-employed – just when they would usually be expected to be driving economic recovery – it would also be uneconomical to squeeze the sector further. Advertisement Andy Chamberlain from IPSE said: “The last few months have financially hammered the self-employed, with over two-thirds seeing a drop in demand for their work. Government support was some help – to a proportion of the self-employed. More noticeable, though, was the 1.5 million who fell through the gaps, leaving many financially devastated. “The idea that this 1.5 million should now suffer a drastic tax hike to pay for support they never got is unjust, uneconomical – and unbelievable. If the Government is really considering this, it must stop now. “Normally, the self-employed would be expected to play a major part in recovery during an economic crisis. This quarter, however, we have seen the biggest drop in self-employed numbers on record. If the Government wants to avoid the country slumping further into recession, it must not squeeze this struggling and vital sector with unjust tax hikes.” Budget A date has yet to be fixed for the Autumn Budget although there is speculation that it will take place in October or November and that the Chancellor will be looking for ways to recoup some of the exceptional Covid expenditure. Press reports have suggested that he is considering increasing Class 4 National Insurance – paid by the self-employed – from 9 per cent to 12 per cent, which could add £200 to the average self-employed tax bill. This would bring self-employed National Insurance contributions in line with those paid by employees. The Chancellor hinted at a move like this when he announced the self-employed support scheme (SEISS) in March, saying "If we all want to benefit equally from state support, we must all pay in equally in future." Tweet -- If you wish to comment on this article, please log in and use the Reply button below. Registering is free and easy - see 'Join Shout99'. - Susie Hughes © Shout99 2020

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