NIC holiday take-up remains low
Chancellor urged to expand scheme, as take-up of NIC holiday falls well short of the government's original projections, despite letter campaign
FEWER than 10,000 businesses have taken up the National Insurance holiday scheme in its first 16 months, the government has revealed.
The scheme, a flagship policy in chancellor George Osborne’s (pictured) first Budget in 2010, allows new businesses outside London, the South East and East of England a ‘holiday’ worth up to £5,000 for up to the first ten employees they hire in their first year of business.
The government originally forecast that 140,000 businesses would be taking up the scheme. However, since its introduction on 22 June 2010, there had been only 8,761 successful applications, Exchequer secretary to the Treasury David Gauke revealed in a parliamentary answer on 1 November. This is despite HM Revenue & Customs sending around 140,000 personalised letters to all businesses that have registered for a PAYE scheme since June 2010, costing around £90,000.
Owen Smith, the shadow Exchequer secretary, told Accountancy Age that the figures were “risible”. The Labour Party has called on the government to expand the scheme nationwide.