The effect is that you will be paying the new enhanced 11 per cent national insurance rate on an ever-increasing proportion of your income as the years go by.But to hit the employer too came out of a clear blue sky. Indeed, all the Chancellor’s actions to date have lulled business into believing this particular tax burden would fall. For the past three years, the Government has reduced the employers’ NI rate, from 12.2 per cent, to 11.9 per cent and then 11.8 per cent last year. Now it is going to be whacked up to 12.8 per cent, the highest rate yet. It makes all the Chancellor’s fine words about having the lowest level of corporate tax in the developed world look ridiculous.For most companies, payroll is far and away the biggest of their costs. A one percentage point rise may not sound very much, but for all companies the result will be that much less for spending on other things, whether it be pay, investment, pensions or the works gym.

The employer’s national insurance contribution has always been a direct tax on employment. With unemployment at historically low levels, the Chancellor could scarcely have chosen a more benign moment to increase the tax burden on business, but that its effect will be damaging is not in doubt.I have to admit that I had mistakenly believed the Government had run out of road for stealth taxes. After the abolition of the tax credit on dividends, which has raised an astonishing £20bn since it was done, the climate change levy, the windfall profits tax and the rest, I naively assumed there was little if any further scope for these back-door taxes. The Chancellor’s pro-enterprise agenda made it impossible to believe he would be coming back for more.He even, a couple of weeks back, went so far as to pre-announce three big tax breaks for business, worth some £650m in total: tax reliefs on the disposal of business assets, the treatment of intellectual property and for research and development.For business, the Budget statement started well too. There were some worthwhile concessions for small business in the amount of work they have to do on VAT returns, and the system of automatic fines Customs & Excise imposes for late payment. OK, so the removal of corporation tax altogether for businesses declaring profits of £10,000 or less is little more than a cheap gimmick. No doubt they exist, but I’ve yet to come across a small business that would allow such a profit to be declared in the accounts.

None the less, even window dressing is better than nothing at all.Then came the pain. The UK branches of overseas companies are to be taxed as if they are UK companies. That’s going to be worth about £350m to the Exchequer and will act as a disincentive to inward investment. The Chancellor has also moved to close a number of VAT and stamp duty loopholes. These had been used as tax avoidance devises, so possibly they deserved to be closed, but the effect is still to increase the tax burden on business. On top of everything else, the Chancellor announced he was taxing North Sea oil profits more heavily.However, all these measures amounted to small change against what was to come. The stunner, the increase in the employers’ national insurance rate, was reserved to the end.