National insurance rises due to take effect this week will force a third of smaller companies to cut jobs, according to evidence presented to the chancellor today.
Gordon Brown faces a stormy reception at the annual conference of the British Chambers of Commerce after this delayed source of extra taxation was singled out for heavy criticism in a poll of 1,000 BCC members.
One in five businesses said they were planning to sack staff to cope with the 1 per cent rise in employer's national insurance contributions, which was announced last year but is due on April 6.
Among small- and medium-sized firms (SMEs), the proportion who say cutting jobs is the only way to meet the extra cost rises to one in three.
Meanwhile, the Treasury has gone on the offensive over national insurance rises, pointing out that the BCC's criticism of the tax, introduced to pay for extra health spending, may reopen splits among employers.
