National Living Wage to rise to £7.50 an hour

National Living Wage to rise to £7.50 an hour

The Chancellor used the Autumn Statement to outline that his government will be following the recommendations of the independent Low Pay Commission, the government will increase the National Living Wage (NLW) by 4.2% from £7.20 to £7.50 from April 2017.

The Chancellor said that this is an estimated pay rise for over a million workers.

In total, earnings for a full-time worker on the National Minimum Wage (NMW) will have increased by over £1,400 a year since the introduction of the NLW in April 2016.20 The government’s target is for the NLW to reach 60% of median earnings by 2020 subject to sustained economic growth.

The government will also accept all of their recommendations for the other NMW rates (which were last increased in October 2016) to apply from April 2017, including:

increase the rate for 21 to 24 year olds from £6.95 to £7.05 per hour

increase the rate for 18 to 20 year olds from £5.55 to £5.60 per hour

increase the rate for 16 to 17 year olds from £4.00 to £4.05 per hour

increase the rate for apprentices from £3.40 to £3.50 per hour

The Chancellor will also invest an additional £4.3m per year to strengthen NMW enforcement.

Meanwhile, the Government reiterated its commitment to lower Corporation Tax to 17% by 2020, as well as unveiling a £6.7bn package which it said will ensure lower business rates.

Seb Maley director of Qdos Contracting, said: “I was somewhat disappointed with the failure of the Chancellor to implement a temporary reduction in Corporation Tax. While the Government reiterated its commitment to lower Corporation Tax to 17% by 2020, I would have liked him to make a bold statement to maybe lower the Tax to 15% and show the world that we are open for business – especially in times of great economic uncertainty post-EU Referendum. I think he’s missed a chance to do that.”

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