Chancellor Rishi Sunak MP has delivered the 2021 Budget, announcing a three part plan as part series of measures to continue support for businesses as the UK recovers from the Coronavirus pandemic.
Headline measures announced by the Chancellor include:
- 100% business rate relief will be extended for three months to the end of June, with a subsequent 2/3 discount applying until the end of the 2021/22 financial year (subject to a maximum cap of £105k for businesses that have remained open)
- A ‘super deduction’ that means for the next two years, when companies invest they can reduce their tax bill by 130% of the cost of that investment
- The furlough scheme will be extended until the end of September with employers asked to contribute 10% from July, and 20% from August
Association of Convenience Stores chief executive James Lowman said: “We strongly welcome the short term measures that the Chancellor has announced to avoid a sudden shock in business rates increases for local shops. The upcoming review of business rates will be crucial in shaping our economic recovery from Covid-19, and we have long argued for the system to be designed to promote and reward investment. It is therefore encouraging to see the Chancellor sharing our focus on promoting investment through his announcement of the new ‘super deduction’.”
Other measures announced in the Budget include:
- A £5bn grant scheme to help businesses hit hardest by the pandemic, with individual grants worth up to £18,000 for hospitality and up to £6,000 for non-essential businesses
- Fuel duty rates and alcohol duty rates to be frozen for the 2021/22 financial year
- The reduced rate of VAT for food and non-alcoholic drinks sold for on-premises consumption and hot takeaway food is to be extended by six months to September 2021, with an interim rate of 12.5% for the following six months to April 2022
- The VAT registration threshold to be frozen at £85,000 until 2026
Mr Lowman continued: “The impact of the pandemic has not been felt evenly, with many local shops and other essential businesses in city centres and other areas severely impacted. We are urging the Government to extend the new £5bn grant scheme to those businesses to help them recover.”
The full Budget document is available here: https://www.gov.uk/government/publications/budget-2021-documents
