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National Insurance Surcharge

Volume 929: debated on Tuesday 29 March 1977

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I turn now to a matter which has attracted a good deal of interest on both sides of the House. This concerns the new National Insurance surcharge which, as I announced last July, will take effect from 6th April as a two percentage points addition to the rate of employers' National Insurance contributions.

I have received many representations from charities, including the Churches, and my right hon. Friend the Prime Minister has received a deputation from some very senior representatives of charitable interests. I have considered the representations very carefully, and I have concluded that there is a strong case for relief in view of the special position of these organisations. Many charities perform valuable work in the community, and the Government would not wish to see them hampered as a result of the operation of the surcharge.

All organisations accepted as charities for income tax purposes will therefore be eligible for relief from the surcharge. The concession will be available from the first payment in respect of the 1977–78 tax year, so that no charity will be required to pay the surcharge. Details of the arrangements are set out in a Press release to be issued this evening.