The OBR (Office of Budget Responsibility) has forecast that the economy will grow by 4% this year
It is expected that the economy will return to pre covid levels by mid 2022 with growth forecast of 7.3% for next year followed by 1.7% in 2023 and 1.6% in 2024
Unemplyment is expected to peak at 6.5% which is lower than the 11.9% originally predicted
So far 700,000 jobs have been lost since the start of the pandemic
A record £355bn will be borrowed by the Uk this year
Further Covid support measures announced
The furlough scheme will be extended to end of September 2021
Government will continue paying 80% of employees wages for the hours they cannot work through to June
in July employers will be expected to make a 10% contribution to furlough pay and 20% contribution in August and September
SEISS will also continue through to September with two more grant payments, fourth covering February – April and fifth covering May – September
Those that completed and filed an SA return by 2nd March will be eligible which is expected to bring another 600,000 newly self employed into eligibilty
Payments will be reduced for those whose turnover has been reduced by less than 30% due to COVID and will only receive a grant of 30% of turnover.
A new restart grant will be offered to businesses from April which will be up to £6000 per premise.
Leisure and Hospitality firms who will be delayed opening for longer will be eligible for grants of up to £18,000
Business rates holiday has been extended for eligible businesses for 3 months and then 2/3rds relief will be available to April 202
Reduced VAT rate of 5% will be extended through to September and then at 12.5% through to April 2022
The threshold for Stamp Duty first band on homebuying of £500k will be extended until June and then it will be £250k until September
Government will give first time buyers a 5% guarantee for mortgages
The £20 uoplift in Universal credit payments will be extended for another 6 months
Working tax credit claimants will be able to get a one-off £500 payment
The National minimum wage will be increased in April to £8.91 per hour
A new recovery loan scheme will be made available providing loans of between £25k and £10m which will be have 80% of the loan guaranteed by the government
Taxation
There will be no changes in Income Tax, National Insurance and VAT rates
The Personal allowance will be increased to £12570 for 2021-22 and then be frozen until April 2026
Corporation tax on Company profits will be increased to 25% from April 2023
Companies with profits up to £50,000 will see corporation tax remain at 19% and there will be tapering rates of Corporation tax from profits under £250,000
Losses of up to £2m will be allowed to be carried back for 2 years
There will be a ‘Super Deduction’ of investments made by businesses against tax for 2 years which will amount to 130% of the investment (so in effect an additional tax reduction of 5.7%
No changes will be made to Capital Gains tax, Inheritance tax or Lifteime paension allowance
£100m to be provided for increase in HMRC investigators
Sport and the arts
£400m will be made available to support arts venues including museums and galleries
£300m recovery package for professional sport and £25m for grassroots sport
Support for Regions and Nations
£1.2bn in funding for the Scottish government, £740m for the Welsh government and £410m for the Northern Ireland executive
750 UK civil servants to be relocated to new Treasury campus in Darlington
£150m for community groups to take over pubs, sports clubs and similar establishments at risk of closure
8 sites for Freeports in England were announced
Digital, Science and Environment
Tax breaks for firms to “unlock” £20bn worth of business investment
Incentive grants for apprenticeships to rise to £3,000 and £126m for traineeships
New visa scheme to help start-ups and rapidly growing tech firms source talent from overseas
Contactless payment limit will rise to £100 later this year
New UK Infrastructure Bank to be set up in Leeds with an intial capitalisation of £12bn
£15bn in green bonds, including for retail investors, to help finance the transition to net zero by 2050
Duties
All duties on alcohol to be frozen
No additional duties on spirits, wine, cider and beer
