Asked by: Michelle Welsh (Labour - Sherwood Forest)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the potential impact of the proposed increase in employer National Insurance contributions on early years providers.
Answered by James Murray - Exchequer Secretary (HM Treasury)
A Tax Information and Impact Note (TIIN) was published alongside the introduction of the Bill containing the changes to employer NICs. The TIIN sets out the impact of the policy on the exchequer, the economic impacts of the policy, and the impacts on individuals, businesses, and civil society organisations, as well as an overview of the equality impacts.
Early years providers play a crucial role in driving economic growth. The Government has committed to delivering the expansion of government-funded childcare and opening 3,000 new school-based nurseries in this parliament. At the Budget, the Chancellor announced that total funding will rise to over £8 billion in 2025-26 to support providers. On top of this, the Department for Education confirmed an additional £75 million of funding in 2025-26 to support the sector deliver the final phase of expanded childcare entitlements from September 2025. Alongside this, rates for the early years pupil premium have also been increased by over 45%, equivalent to up to £570 per eligible child per year.
Asked by: Michelle Welsh (Labour - Sherwood Forest)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether her Department has made an assessment on the potential merits of extending eligibility for the zero-rate VAT for charities to include flood defence equipment.
Answered by James Murray - Exchequer Secretary (HM Treasury)
To protect the country from the devastating impacts of flooding, the Government has committed £2.4 billion over the next two years to improve flood resilience by maintaining, repairing and building flood defences.
Through this funding the Government provides direct support to communities facing flooding, and therefore we have no plans to change the VAT treatment of flood defence equipment for charities. VAT is a broad-based tax on consumption and the 20 per cent standard rate applies to most goods and services. VAT is the UK’s second largest tax forecast to raise £171 billion in 2024/25. Taxation is a vital source of revenue that helps to fund vital public services including schools and hospitals.