Chancellor should roll back employers’ National Insurance at Autumn Budget
Added by Love Business East Midlands | 23 October 2025
Chancellor Rachel Reeves should roll back the rates of employers’ National Insurance contributions (NICs) when she delivers her Autumn Budget on 26 November, according to tax experts at Mercia.
At last year’s Budget, Ms Reeves increased to the rate of employer NICs by 1.2 percentage points to 15% from 6 April 2025.
However, this has been condemned as a tax on jobs by business groups, who claim the increase fuels inflation, reduces hiring intentions and fails to stimulate economic growth.
Ms Reeves is expected to try and raise as much as £40 billion through tax increases and public spending at the upcoming Autumn Budget. The question now is where the Chancellor will look to make the necessary fiscal changes to reach such a significant target.
Mercia’s tax experts say that Ms Reeves should not only reverse the increase to employer’s NICs made last year but also roll back the reduction to employee’s NICs made by the previous Chancellor, Jeremy Hunt, in his final Budget statement.
Victoria Kelly, Managing Director at Mercia, said:
‘Reversing the employer NICs increase would support job creation at a time when growth is flat and confidence is fragile.
‘Most employees didn’t notice the earlier cut to their NICs, so restoring it would have limited impact on household budgets but could offset the cost to the Treasury.
‘Unlike changes to Income Tax, which people understand and notice, NICs can go under the radar. The government could make this adjustment without significant political fallout — and send a clearer signal that it's backing business.’
