Plans to increase the employer National Insurance Contributions (NICs) by one per cent have been met with strong opposition from across the business world.

IT contractors would be among those to suffer if the plans go ahead, the Recruitment & Employment Confederation (REC) has claimed.

A petition has been started to protest the proposals, signed by the REC the British Chambers of Commerce, the British Retail Consortium and a number of other business representatives.

Any increase in NICs would be "tantamount to a tax on jobs", according to REC chief executive Kevin Green.

"2010 is witnessing the first stirrings of a recovery with employers starting to feel more confident about recruiting. Increasing taxes on business will choke off recovery and will hinder getting people back into work," Mr Green added.

The government's plans are not bad news for all however.

By raising the level at which employees start paying NICs, workers earning under £20,000 will actually pay less in NICs than before.