Job loss fears as national insurance hike takes effect

Prices could increase and staff working hours fall as the rise in employer national insurance contributions NICs) comes into force today, ministers have been warned.

- CAITLIN DOHERTY

The rate of employer NICs will go up by 1.2 percentage points from 13.8 per cent to 15 per cent, and the payments will start when an employee earns £5,000, down from the previous level of £9,100.

The tax increase comes as businesses are also dealing with an 6.7 per cent rise in the minimum wage which came into force last week.

The Conservatives have labelled the change a “jobs tax” while the boss of a hospitality industry group has said the move will have a negative impact on job creation.