WITH less than a month to go until Labour’s Jobs Tax comes in, businesses and workers in Central Devon and across the country are bracing themselves for the fallout from the Government's disastrous decision to raise employers’ National Insurance.

From April 6, businesses will be required to pay an additional £900 per employee for the average worker, a move which will have far-reaching consequences for the local economy and our communities.

At a time when households are already struggling with rising costs due to inflation, the government’s Jobs Tax is set to make an already difficult situation even worse.

The Labour Chancellor says the £25 billion tax increase will provide additional funding for public services.

The tragic reality, however, is that much of the money raised in tax will be absorbed by increased borrowing and debt interest costs.

As an entrepreneur who has built businesses from scratch, I know that this tax hike will be devastating for many small businesses across Devon.

Last week, for example, saw the closure of Crusty Cob, a beloved family-run bakery just up the road in Exeter.

After 55-years of service, spanning four generations of the Tubbs family, the bakery has shut its doors, leaving more than 100 people out of work.

The family say they’ve been forced to close all nine of their shops because of rising costs, the strain of inflation, and National Insurance increases.

This is not an isolated incident.

According to the Chartered Institute of Personnel and Development, almost a third (32 per cent) of businesses impacted by the rise are planning to freeze hiring or make job cuts, while more than one in four (42 per cent) intend to increase prices.

The British Retail Consortium estimates that as many as 160,000 part-time retail jobs could be lost in the next two years as businesses struggle to cope with the increased labour costs.

While retailers like Currys and Marks and Spencer are already indicating they will have to raise prices and reduce hiring as a result of the Chancellor’s Jobs Tax.

For industries like retail, hospitality, and leisure, which rely heavily on part-time or lower-wage workers, the government’s decision to lower the threshold at which employers begin to pay National Insurance is particularly damaging.

It will make it more expensive to employ part-time workers, further exacerbating the pressures on businesses already grappling with rising costs.

Hospitality UK estimate as many as three-quarters of a million hospitality jobs could be brought into the tax net by this change, making it harder for workers and businesses to survive.

The government’s approach to National Insurance is reckless. It threatens jobs, stifles growth, and hurts local communities.

If Labour are serious about delivering “growth, growth, growth”, they must cancel the Jobs Tax before it causes further damage to the local economy and our communities across Central Devon.

Mel Stride

MP for Central Devon