Taxpayers foot jobs tax bill, claims MSP

Last month North Ayrshire Council (NAC) passed its budget for 2025/26, agreeing to a 7 per cent increase in Council Tax to take effect from April.

MSP Colin Smyth says  53 per cent of the extra revenue raised in Council Tax this year will go towards covering the increase in Employers’ National Insurance Contributions brought in by the UK Labour Government and the total direct cost of the policy to NAC is £6.618 million.

“Despite the UK Government Labour promising to mitigate the cost to the public sector, they provided Scottish Ministers with only enough cash to meet 60 per cent of this cost. 

“The remaining 40 per cent will impact North Ayrshire residents by £2.647 million of the £5.008 million in additional Council Tax being raised in 2025-26.

“This is only the direct costs to the local authority. There will be significant additional costs from the increased costs to services commissioned by the Council.

“Labour’s ill-considered decision to raise employers’ National Insurance contributions is having significant consequences for charities, businesses, universities and private care homes," he warned.

And added: "Yet the UK Office for Budget Responsibility told the Chancellor, prior to last October’s Budget 75% of the impact of this tax would fall primarily on low-paid employees, averaging £850 each in lost wages, whilst 25 per cent would lead to reduced investment and employment.    

“Labour must reverse this tax on jobs before it causes even more damage to wages, public services, businesses, and growth.”