Summer Statement: Covid-19 Help for Businesses and Individuals
Rishi Sunak, Chancellor of the Exchequer, provided details in his Summer Statement addressing how the Government would support the economy in the wake of the coronavirus lockdown. This was the first announcement of new economic stimulus measures since the March 2020 budget.
The Chancellor opened the Statement by focusing on his so-called ‘plan for jobs’ – a suite of measures designed to fight unemployment across the UK:
- It was announced that the job-retention scheme (known as the furlough scheme) will end in October, with the Government share of wages decreasing gradually until then.
- Businesses will also receive £1,000 for each furloughed employee retained until January 2021, provided they earn over £520 per month.
- The ‘kickstart’ scheme will pay the wages of new young employees for six months, with no requirement for a longer contract.
- Businesses will receive £2,000 for each apprentice they take on – this bonus reduces to £1500 for apprentices aged over 25.
Hospitality and tourism:
- VAT will be cut on food and tourism to 5% (from 20%) until January 2021.
- A new ‘eat out to help out’ scheme was announced: it will provide a 50% discount in restaurants, cafes and pubs on food and non-alcoholic drinks (up to a maximum of £10) on Mondays, Tuesdays and Wednesdays in August. Businesses can expect to be paid within 5 working days once they have registered for the scheme and claimed.
- Stamp Duty will be abolished on the first £500,000 of a residential property’s purchase price, until 31 March 2021 – good news for both home buyers and sellers. The average property will see a cut in stamp duty of around £4,000.
- Poorer families will benefit from vouchers worth between £5,000 and £10,000 for home insulation projects.