Stop Labour's tax on jobs and working people from killing the recovery

Thousands of people in Orpington will save money under Conservative initiative

Jo Johnson, Conservative Prospective Parliamentary Candidate for Orpington, this week gave his backing to new Conservative plans to stop a new jobs tax on working families and local firms. Labour Ministers confirmed in the recent Budget that Gordon Brown’s Government will be increasing National Insurance on both workers and local businesses. Under Labour’s tax-raising plans, anyone earning over £20,000 a year will see their pay packet shrink. Labour will also increase the tax that local firms pay for hiring workers who earn £5,700 a year or more.

By contrast, a Conservative Government will stop the most damaging part of Labour’s tax on jobs by cutting government waste while protecting frontline services. The cost of Labour’s tax rise on employers will be reduced by more than half. And anyone earning between £7,100 and £45,400 – seven out of ten working people across the country – will be up to £150 a year better off than under Labour’s plans.

A typical nurse, teacher, firefighter or police officer who lives or works in Orpington would save an average of £150 a year. People on lower incomes will benefit the most as a proportion of their incomes. And an estimated 7,000 jobs could be saved across the whole of London by making it less expensive for firms to hire workers.

The Conservative plans have have been backed by leading business figures who run firms such as Sainsbury’s, Mothercare and Marks & Spencer, and who employ over half a million people between them in the UK.

Jo Johnson said:
“For the last 13 years, working people across Orpington have seen their taxes go up and up and their money wasted. Now Gordon Brown is planning a tax on jobs that will hit anyone earning over £20,000 a year and destroy vital job opportunities by taxing local firms more.

“Labour will kill the recovery with their tax on jobs. Conservatives will cut Labour waste to stop it. Thousands of people in Orpington will be better off with the Conservatives. And we’ll cut Labour’s debt to stop higher interest rates and your mortgage going up. We’re all in this together, and we need new energy and fresh ideas to get Orpington working for everyone.”


Notes to Editors


Labour’s tax on workers: Labour are planning to raise Employees’ National Insurance Contributions (NICs) for everyone earning over £20,000. Conservatives will stop this increase altogether for everyone earning under £35,000 by raising the primary threshold at which people start paying NICs by £24 a week, and raising the Upper Earnings Limit by £29 a week.

Relative to Labour’s plans, everyone liable for Employees’ NICs earning between £7,100 and £45,400 – which is 7 out of 10 working people – will be up to £150 better off a year under the Conservatives. Lower earners will get the greatest benefit as a percentage of their earnings. Nobody will be worse off.

Labour’s tax on local firms: Labour are also planning to raise Employers’ NICs for everyone earning over £5,700. This is a tax on jobs that will undermine the recovery. Conservatives will raise the secondary threshold at which employers start paying NICs by £21 a week, saving employers up to £150 for every person they employ relative to Labour’s plans. This will reduce the cost of Labour’s tax rise on employers by more than half.

According to a report by the Centre for Economics and Business Research for the Federation of Small Businesses (Small business tax increases – do the economic costs outweigh the fiscal gains?), adding 1p to employers’ National Insurance Contributions would cost 57,000 jobs in small and medium-sized enterprises alone.

Conservatives will pay for the cost of these tax reductions by cutting government waste, without affecting frontline services, such as by halting all major IT spending, renegotiating major contracts, controlling recruitment and cutting out discretionary spending. A briefing note on the savings is available here.


Conservative plans to stop the jobs tax has been backed by the leaders of the following companies:

JCB, Aggregate Industries, Jardine Lloyd Thompson, Kingfisher plc, Kurt Geiger, Xstrata plc, Tullow Oil plc, Carpetright plc, J Sainsbury plc, GlaxoSmithKline plc, Mothercare plc, easyGroup, Mitchells & Butlers plc, SABMiller plc, Matalan, AXA UK, Virgin Group Ltd, Whitbread Plc, Marks & Spencer plc, Diageo Plc, Harvey Nichols, Bext plc, Bestway Cash & Carry and Boots.

Source: Daily Telegraph, 3 April.