From stamp duty holiday to furlough, what to expect from Chancellor Rishi Sunak's Budget - iNews

The 3 March Budget comes amid a backdrop of financial challenges for Chancellor Rishi Sunak.

In the midst of the Covid-19 pandemic, UK borrowing is at a record high and the Office for Budget Responsibility (OBR) has estimated public debt will hit £394bn by the end of the financial year.

While the end of lockdown may be just around the corner, the country is still very much in the thick of the pandemic and has not even begun its economic recovery.

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Figures from the Office for National Statistics (ONS) released last week show unemployment has risen to 5.1 per cent, its highest level since 2015, with the youngest workers most likely to have lost their jobs.

The post-Brexit transition period also came to an end in December, throwing up a series of new challenges around trade and borders which are being navigated by British businesses already struggling due to the pandemic.

And the Government must also consider its legally binding pledge to reach net zero carbon emissions by 2050.

The Chancellor is due to get on his feet in the Commons shortly after 12.30. Viewers at home can watch the Budget on major news channels, Parliament TV and can follow coverage and analysis on inews.co.uk.

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Ahead of the statement, here are the key announcements expected:

Covid support

The Coronavirus Job Retention Support Scheme (CJRS), which allows companies to claim the wages of furloughed workers who are unable to work, will be extended to September.

The Self-Employment Income Support Scheme (SEISS) is expected to be extended to cover the months of February, March and April and Mr Sunak is set to announce that 2019-20 tax returns can be used to claim the support.

An extension to the Universal Credit uplift has not yet been confirmed.

Pubs, restaurants, shops and other businesses hit hardest by the coronavirus pandemic will be boosted by a £5 billion grant scheme to help them reopen, with the “restart grants” worth up to £6,000 per premises.

Mr Sunak is believed to be preparing to extend the business rates holiday for shops and the reduction of VAT to five per cent for the hospitality sector.

Business boost

A £520 million initiative will be announced to support small and medium UK businesses with training and software under the “Help to Grow” scheme.

Culture and sport

He will offer an extra £400 million of additional support to boost the culture sector damaged due to Covid-19 lockdowns, with £300 million due to be plugged into the £1.57 billion Culture Recovery Fund.

National museums and cultural bodies will also receive £90 million to help keep them afloat until they can reopen and £18.8 million will be provided for community cultural projects.

An additional £77 million will be given to the devolved administrations in Scotland, Wales and Northern Ireland to provide their culture groups with similar backing.

Mr Sunak will also ring-fence a “significant chunk” of a £300 million sports recovery package to cricket as fans prepare to return to stadiums this summer.

A £2.8 million boost will help fund a joint UK and Ireland bid to host the 2030 football World Cup.
Vaccines

The Chancellor will give the UK’s coronavirus vaccine rollout £1.65 billion in additional funding to ensure the target of offering a dose to every adult by the end of July is met.

Mr Sunak will also divert £22 million to fund a “world first” trial to test if different vaccines can be used together, or if a third dose is effective, the Treasury said.

Mr Sunak will also give £33 million to improve the ability to respond to new variants and improve vaccine testing, including £5 million to create a “library” of Covid-19 jabs.

That cash, like the funding for the vaccine trial, will come from the Vaccine Taskforce’s existing budget.

Housing

The Chancellor is widely expected to extend the stamp duty holiday on properties worth £500,000 or under until the end of June. It is currently due to end on 31 March.

The Treasury announced first time buyers will be able to get a mortgage with a five per cent deposit as part of a plan to revitalise the “Help to Buy” scheme.

The Treasury will guarantee part of the loans to encourage banks to offer the riskier mortgages on properties worth up to £600,000.

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Taxes

The Tory manifesto in 2019 promised not to raise the rates of income tax, National Insurance or VAT.

But Mr Sunak is reported to be considering a freeze in the thresholds at which people start paying income tax or move into higher brackets – meaning more people would be dragged into those categories as wages increase.

The reported proposals include freezing the £12,500 threshold at which people start paying tax and the £50,000 threshold where the 40p rate kicks in.

Mr Sunak is expected to announce an increase of corporation tax from 19 per cent to as high as 25 per cent.

Green Policies

The UK will launch a sovereign green savings bond for retail investors allowing savers to help drive the country’s transition to net zero by 2050 by investing in bonds thorough NS&I, the Treasury-backed savings group which issues Premium Bonds.

It will invest £20 million in offshore wind, £70 million in long-term, low-carbon energy storage and £4 million to boost green-energy crops.

The Prime Minister has ruled out introducing new consumer taxes – such as a levy on meat or carbon – as part of his green policy drive.

And the fuel duty freeze is set to continue, with Prime Minister Boris Johnson telling The Sun: “I firmly believe the economic recovery is going to be powered by White Van Man amongst others.”

Visa changes

Mr Sunak is expected to unveil a new fast-track technology visa scheme for start-up companies for migrants with a job offer from a tech company.

Community ownership

Community groups will be given up to £250,000 to help buy struggling local pubs in their area through the Community Ownership Fund.

Thalidomide compensation

The Treasury is expected to announce a life-time financial aid package for the victims of the Thalidomide scandal.

According to reports, £39 million will be earmarked for the first four years to fund the thalidomide health grant, which helps about 400 people in the UK gain access to specialist treatment and rehabilitation.

Veterans

The Chancellor is expected to provide £10 million in new funding to support veterans with mental health needs.

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2021-03-03 07:44:00Z
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