Tue 21st Jan 2025 - 774,000 hospitality workers to be dragged into new NICs threshold, costing sector £1bn 774,000 hospitality workers to be dragged into new NICs threshold, costing sector £1bn: Hundreds of thousands of hospitality workers are set to be dragged into the new national insurance contributions (NIC) threshold, costing the sector £1bn, UKHospitality has said. New analysis from the trade body showed a fifth of the UK’s hospitality workforce will come under the threshold for the first time, with the changes hitting the sector the hardest due to the high number of employees working part-time or flexibly. Currently, more than 1.2 million hospitality staff are not eligible for employer NICs, but in April, that number will be slashed to just over 450,000 people. That means more than 774,000 workers that will be newly eligible for employer NICs, which UKHospitality said will cost the sector £1bn. The trade body is calling on the government to implement a delay to these changes, to allow Downing Street to pursue alternative measures that ensure lower earners aren’t hit the hardest. These include a new rate of employer NICs at 5%, rather than 15%, for earnings between £5,000 and £9,100, or a lower rate for lower-earning taxpayers who work part-time. UKHospitality chief executive Kate Nicholls said: “The change to employer NICs is one of the most regressive tax changes ever. The scale of this change is unprecedented, bringing three-quarters of a million people into this employer tax for the first time, and the extent of the impact will be enormous. This tax is already forcing businesses to abandon investment, change recruitment plans, reduce headcounts and increase prices to cope with these cost increases. At a time when we saw hospitality as the biggest driver of economic growth in November, it’s completely misguided to be punishing a sector that has such growth potential. I hope the government can see the devastating impact this will have on businesses, team members and communities, and pause these changes to pursue alternative measures, in partnership with business.”