Rishi Sunak, Chauncellor of the Exchequer has made a series of announcements regarding actions the government will soon take to help during the COVID-19 crisis. I’m very supportive of the whole package. Let’s look at the key points.
Hospitality and Tourism VAT dropped to 5%
The hospitality and tourism industries have suffered massively during the last few months, and while things may be picking up speed soon, business owners will still struggle to pick up the pieces as we move forward. This is why the plan to decrease VAT from 20% down to 5% for these industries will be a massive help for them. For the next 6 months this discounted system will be in place. This is one of many creative ideas that Sunak is introducing to help fight COVID-19’s effects.
Chancellor gives diners 50% off on eating out
During August 2020, Diners will receive a 50% discount on their restaurant bill, in a push to help the hospitality sector. If you plan to eat out between Monday-Wednesdays, you can discount up to £10 per head. Businesses that want to take part in the scheme will have to register through a website that opens on Monday 13 July. More information will be provided next week for this!
Meal Vouchers are a good shot in the arm for hospitality – excellent news for those of you in that industry!
Job Retention Bonus
The government will also be bringing in a £1000 bonus for each worker who returns from furlough who is still employed by the end of January. The government believes this could cost up to £9bn – a pretty easy calculation of 9 million furloughed workers x £1000. For business owners, it may not be such a simple calculation.
You might prefer to start paying 5% of employee wage costs in the coming month, then 14% in September and 20% in October. You can then follow this by 3 full months of full wage to receive that £1000 bonus. If you’re unsure on what to do, please speak to us about this. A lot of this will depend on demand, but hopefully this will keep many in employment for longer.
Stamp Duty Threshold Rise to £500,000
The stamp duty as a tax has been something I’ve disagreed with for a long time. It is great news that this is being adjusted, as this may help to stop the housing price drop. The only problem that might arise here is that those forward thinking young people who look at the bigger picture may not like this. The housing drop was a great opportunity to allow new buyers onto the property ladder, so anything to prevent this drop in price may be unwelcome.
If there’s anything here you’re unsure of, please do contact us, and hopefully this means good news for you too!