The Government has announced that it has no plans to increase national insurance rates for the self-employed during its time in office. It was originally anticipated that class four NICS (contributions paid by the self-employed) would increase from 9% to 10% in April 2018 and then to 11% in 2019. However, Chancellor Philip Hammond has now announced that no such increases will take effect. NICS for the self-employed will therefore remain at 9%, with national insurance contributions relevant to the employed workforce currently standing at 12%.
The increase in the national insurance rates was forecast to raise over £2 billion by 2022. Commentators have therefore questioned how the Government pledge to “balance the books” will be met, with no prospects of any replacement direct tax increases.