Murray presses PM over small business national insurance in East Dunbartonshire

Mid Dunbartonshire MP Susan Murray has today pressed the Prime Minister over the high taxes faced by local business owners in her constituency and in particular the Labour UK Government's decision to increase national insurance.

In October of last year, the Labour Government decided to lower the threshold for employees to start paying national insurance from £12,000 to £5,000, pulling more part time employees into paying National Insurance and increasing the amount employers have to pay for part time employees.

This puts local jobs at risk as more business owners decide to not to employ staff and stop doing the additional work which comes with being an employer - often with a reduction in their hours working on admin but without a reduction in their personal income. Some businesses are avoiding growth to stay under the VAT threshold, again reducing the number of local jobs.

Speaking during Prime Minister’s Questions, Ms Murray said:

"Calithea studios in my constituency is a prime example of a business doing everything the government asks. The owner of this beauty salon and her 3 employees earn less than £30,000 per year yet the business will pay the government £25,600 in VAT, £8,000 in Employers National Insurance and £2,800 in employer pension contributions adding up to over £36,000 for the year.  

"Does the prime minister think it's fair that the hard-working owner who is providing local jobs and training on the high street contributes more to the exchequer than she earns in a year?"

Speaking after the exchange, Ms Murray added:

"I'm deeply frustrated by this answer from the Prime Minister. He seems completely numb to the challenges that are facing businesses in my constituency.

"I recently met with representatives from the Beauty Salon Business sector. They shared the challenges these businesses have had since returning after Covid. Like other small businesses they had to recover after furlough and repaying Covid business loan costs. Hot on the heels of this came the huge hike in the cost of energy and removal of business rates support. And yet they have struggled on adapting to the changes with determination that I can only admire.

"In Mid Dunbartonshire we have 219 hair and beauty businesses. Forcing them to pay higher and higher costs when they cannot increase their prices puts our high streets at risk and reduces income for local authorities as they either fail and move out or move to more affordable premises.

"My party has set out plans to reform business rates and cut energy bills. Now the UK Government should set out what it is going to do lower costs for businesses."