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More support measures for workers, businesses announced in UK budget
04 Mar '21
2 min read
UK Chancellor of the Exchequer Rishi Sunak. Pic: GOV.UK
British chancellor of the treasury Rishi Sunak recently announced further support measures for workers and businesses struggling with lockdown in his first budget since the pandemic began. The furlough scheme and higher universal credit payments will be extended till September. But taxes on profits of large companies will be raised in 2023.
The headline rate of corporation tax will go up from 19 per cent to 25 per cent from 2023, although smaller firms will be exempt. More than a million more people will come under the income tax net and it will take the UK's tax burden to its highest level since the 1960s, said the office for budget responsibility (OBR).
In his budget speech, Sunak said unemployment will be lower—and growth higher—than previously thought as the United Kingdom emerges from lockdown later this year, citing forecasts from the OBR watchdog.
But he cautioned that repairing the long-term economic damage ‘will take time’, with the economy in five years' time predicted to be 3 per cent smaller than it would have been without the pandemic.
Despite the £280 billion worth support already committed to protecting the economy, the harm done by the novel coronavirus pandemic had been ‘acute’, he told parliament.
"Our economy has shrunk by 10 per cent—the largest fall in over 300 years. Our borrowing is the highest it has been outside of wartime. It's going to take this country—and the whole world—a long time to recover from this extraordinary economic situation. But we will recover," he said.
Other features of the budget include an increase the limit on contactless payments from £45 to £100, eight 'freeports' in England, with lower taxes and ‘cheaper customs’, business rates holiday in England extended by three months, £100 million to set up a taskforce to tackle fraud in government COVID schemes, more money for vaccine roll-out and £5 billion to help High Street firms reopen.
The headline rate of corporation tax will go up from 19 per cent to 25 per cent from 2023, although smaller firms will be exempt. More than a million more people will come under the income tax net and it will take the UK's tax burden to its highest level since the 1960s, said the office for budget responsibility (OBR).
In his budget speech, Sunak said unemployment will be lower—and growth higher—than previously thought as the United Kingdom emerges from lockdown later this year, citing forecasts from the OBR watchdog.
But he cautioned that repairing the long-term economic damage ‘will take time’, with the economy in five years' time predicted to be 3 per cent smaller than it would have been without the pandemic.
Despite the £280 billion worth support already committed to protecting the economy, the harm done by the novel coronavirus pandemic had been ‘acute’, he told parliament.
"Our economy has shrunk by 10 per cent—the largest fall in over 300 years. Our borrowing is the highest it has been outside of wartime. It's going to take this country—and the whole world—a long time to recover from this extraordinary economic situation. But we will recover," he said.
Other features of the budget include an increase the limit on contactless payments from £45 to £100, eight 'freeports' in England, with lower taxes and ‘cheaper customs’, business rates holiday in England extended by three months, £100 million to set up a taskforce to tackle fraud in government COVID schemes, more money for vaccine roll-out and £5 billion to help High Street firms reopen.
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