The announcement by Chancellor Philip Hammond that National Insurance Contributions will rise for the self-employed has been labelled 'bad news' by the Farmers' Union of Wales (FUW).
Contributions will rise by 1% to 10% from April next year and then then rise again to 11% in 2019.
FUW has described this as 'bad news' for family farms and those working in the agricultural industry.
The increase, so the FUW says, will hit the low and middle earning self-employed, and as the majority of UK family farms are classed as such, the measure will 'do little' to support rural businesses.
There are currently 2 types of National Insurance for the self-employed: Class 2 if profits are £5,965 or more a year and Class 4 if profits are £8,060 or more a year.
Those self-employed currently pay 9% on profits between £8,060 and £43,000 and 2% on profits over £43,000. From next year those making a profit of over £43,000 will still pay 2%.
'Will hit farmers across UK badly'
FUW Managing Director Alan Davies said: “Philip Hammond claims that these increases make the system fairer, but I can’t see how increasing tax for those who are making a profit of less than £43,000 is fair.
“Why is it that tax is being increased for those hard working individuals, some of whom only make a profit just over £8,000, whilst at the same time corporation tax is falling?
“This increase will hit farmers across the UK badly, and that at a time when they are already having to cope with an increase in business rates, which of course is devolved to Wales, but the increase in NIC is not.
“Add to that the uncertainty around future agricultural support and those making a living from agriculture are not being put in the most favourable financial conditions.”
However, Chancellor Philip Hammond has defended the plans - arguing it makes the system more "fair".
