Analysis by the Scottish Parliament Information Centre (SPICe) found the average employer is now paying an extra £1,053 a year in National Insurance for a worker earning the Scottish median salary of £39,879.
Even workers earning the Real Living Wage are costing employers significantly more, with businesses paying an additional £890 a year in National Insurance for a full-time employee earning around £26,228.
Why have employers’ costs increased?
The rise follows changes introduced by Chancellor Rachel Reeves.
The reforms increased the rate of employers’ National Insurance while also lowering the earnings threshold at which businesses begin paying the tax.
Critics argue the changes have increased employment costs at a time when many firms are already facing higher wage bills and rising operating expenses.
Businesses facing higher payroll bills
The analysis was commissioned by the SNP, which says the figures demonstrate the financial burden the National Insurance changes have placed on employers.
Laura Mitchell MSP said the policy had created a “high-cost” environment for businesses.
She said: “Andy Burnham must, as a priority, scrap the Labour Party’s national insurance tax hike, which has destroyed jobs and cost Scotland’s businesses huge sums of money.”
She added: “Analysis now shows that this policy is costing business in Scotland around £1,000 per employee.”
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The SNP is urging Andy Burnham, who is expected to become Prime Minister later this month, to reverse the increase in employers’ National Insurance.
Responding to the calls, a spokesperson for Mr Burnham said: “Andy is focused on delivering good growth in every postcode, raising living standards and giving families breathing space by tackling rising costs. On tax, he is committed to the manifesto.”
The figures add to the continuing debate over the impact of higher employment taxes on businesses, with many employers warning that rising payroll costs make it harder to recruit staff, increase wages and invest for growth.
