The government today announced that the increase in Class 4 National Insurance Contributions (NICs) for self-employed workers, unveiled in the Spring Budget last week, will now not go ahead.
Philip Hammond had faced criticism from all sides of the House of Commons over the planned hike.
Rob Lankey, chief executive of the National Association of Commercial Finance Brokers (NACFB), said: “Mr Hammond’s swift about-turn on the subject of NICs will rally the self-employed who might have felt unfairly targeted in last week’s Budget.
“Working attitudes have shifted over the last couple of years to allow for increasingly flexible employment types – the upturn in the number of self-employed workers in the economy is just one of the benefits of this.
“Last week’s decision to increase national insurance contributions for this group of workers was a low-blow to businesses that rely on these innovative ways of working – such as companies within the gig economy – as well as the likes of buy-to-let property investors.
“This retreat by the government will undoubtedly cheer businesses of all sizes, but particularly small companies that often call upon non-permanent staff to operate effectively.”