The Federation of Small Businesses (FSB) has joined forces with a group of other business and employment organisations in the UK (comprising the British Chambers of Commerce, Institute of Directors, British Retail Consortium, Confederation of British Industry, the Chartered Institute of Personnel and Development, Forum of Private Business and the Recruitment and Employment Confederation) to call on small firms to sign a petition urging the government to freeze National Insurance rates.

The FSB revealed that research conducted in conjunction with the Centre for Economics and Business Research (CEBR) had suggested that increasing employers' National Insurance by one per cent will cost 57,000 jobs at a time of record unemployment figures, but will not give any substantial help to plug the Government's gap in public finances.

The FSB hopes that a significant response from small businesses to the petition will persuade the Government to reverse the planned NI hike, and put a halt on any future rises in the foreseeable future. Raising taxes on small businesses must be a last resort if they are to do their job of helping to put the country on a steady road to recovery, the Federation argues.

John Wright, FSB National Chairman, explained that:

"This petition – calling for no rise in National Insurance Contributions – will tell Government that real action needs to be taken to really help tackle unemployment. The rise in National Insurance is a tax on jobs and will cost the country in thousands of jobs, as well as prevent small firms from taking on more members of staff at this crucial time in the country's economic recovery."

He continued: "The FSB has been calling on the Government to take steps to make it easier for the country's 4.8 million small firms to employ staff. The FSB knows that small firms want to recruit over the coming year, but are put off by taxes. The Government can give the economy a real helping hand by freezing National Insurance and helping to encourage small firms to grow and take on additional employees."

The petition can be found at www.no-nics-rise.co.uk.