Proposals to increase National Insurance contributions for the self-employed are scrapped
16 March 2017
Following the announcement regarding the proposed increase of Class 4 NICs in last week's Spring Budget, the Chancellor has decided not to proceed with this measure. He wrote to Conservative MPs today stating that while 'it remains our judgment that the current differences in benefit entitlement no longer justify the scale of difference in the level of totals NICs paid in respect of employees and the self-employed' on the basis of 'the spirit of the commitments that were made…[and] a clear view among colleagues and a significant section of the public' the proposed increase will not be implemented during this Parliament.
This will be very good news for the self-employed community. However, the Chancellor also stated that the cost of these changes will be funded by measures that will be announced in the Autumn Budget. There may, therefore, be a sting in the tail.