Osborne proposes tax cuts for fledgling companies

New companies will be in line for relief on their employer National Insurance contributions if the Conservatives come into power.

Shadow Chancellor George Osborne announced that a future Conservative government would exempt start-ups from paying employer NI contributions, presently 11% up to the upper earnings threshold of £844 per week, on the first ten employees it hires during its first year, Taxnews reported.

This would only apply for the opening two years of a Tory tenure.

According to Osborne, the tax break will encourage new entrepreneurs and would generate around 60,000 additional jobs over two years.

However, the Labour government has dismissed the proposed tax break as a " gimmick" while the Liberal Democrat party warned that the move could give new firms an unfair competitive advantage over their more established rivals.