London, Europe Brief News – Due to Cost-of-Living Crisis, Rishi Sunak is facing renewed pressure from Business leaders to delay a planned £12bn rise in National Insurance. The companies and Households are battling with soaring costs as the Russian invasion of Ukraine drives up inflation all over Europe.
The manufacturing trade body Make UK which represents 20,000 companies of all sizes across the country said that the tax hike planned for April should be pushed back until the UK economy is in much better shape.
It also warned the government that pressing ahead would increase the risk of firms slamming the brakes on recruitment and putting the economic recovery from Covid-19 at high risk.
As Russian President Vladimir Putin is intending to go all out on Ukraine, Business Lobby groups said that it is not the right time to put pressure on companies and houses citing the cost-of-living crisis.
Stephen Phipson, The Chief Executive of Make UK said “ The proposed increase remains illogical and will be even more ill-timed given how circumstances have rapidly changed since it was announced”.
He further added, “ The cost burden on business is continuing to escalate and, while some of these increases are due to global events, the government must avoid shooting business in the foot by an entirely self-imposed decision”.
How firms are coping with the current situation
Make the UK conducted a survey of almost 300 manufacturing companies and concluded that as many as three in five said the tax rise would have an average or significant impact on their hiring intentions.
Almost three quarters said they would pass on or would be very likely to pass on, the rise in the cost to the customer in the form of higher prices for their products and services.
It comes as the fighting in Ukraine drives up global energy prices, and as the conflict and western economic sanctions unleashed in response lead to tension over the supply of Russian gas to Europe.
As the sharp increase was seen in the wholesale gas market over the last week, the experts said that UK inflation could increase from 5.5% to 8% within months. This is the highest level of inflation ever seen during the last three decades.
Boris Johnson tried to draw a line under demands to detain the planned tax rise, arguing with Sunhak that the policy was the right thing to deal with NHS Covid blockage and reform to social care.
