Bectu has hit out at the rise in National Insurance for freelance workers announced by Chancellor Philip Hammond in his 2017 Budget.
National Insurance Contributions (NIC) from self-employed workers are set to rise from 9% to 11% by 2019. Tax allowances for workers who are directors of their own personal service companies will be cut too. From April 2018, the total amount of dividends that company directors and shareholders can receive tax-free will fall from £5,000 to £2,000.
Gerry Morrissey, head of BECTU, the media, entertainment, and communications sector of trade union Prospect, said: "This is a slap in the face for thousands of our freelance members, who have been hit by a unfair and unjustified increase in tax. Self-employed workers will be paying almost the same employment taxes as secure staff, without employee benefits, and the security, that staff have."
"Our freelance members are running genuine small businesses, carrying economic risk and paying many costs, without any guarantee of future work from any engager."
"Raising their taxes will squeeze their already tight margins, and harm their standard of living. This is the exact opposite of what the government claims to be doing to help entrepreneurs. There is no problem of false self-employment, or disguised employment, in our sector," Gerry Morrissey continued.
Currently self-employed workers pay 9% Class 4 NIC on earnings between £8,060 and £42,355, and 2% above. Self-employed Class 4 National Insurance is now set to rise to 10% in 2018, and 11% in 2019.
Employed workers pay 12% on the same banded structure but, notes Bectu, are entitled to a greater range of state benefits than the self-employed, and also enjoy many contractual benefits like sick pay, maternity pay, and free training, none of which are available to freelancers.
Share this story