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Economic Update from The Chancellor of The Exchequer

Economic Update from The Chancellor of The Exchequer

The main announcements by the Chancellor in his statement on 8th July 2020 are:

Help for the Hospitality Sector:

  • In August, everyone in the country (both adults and children) will be given an “eat out to help out” discount – 50% off at participating restaurants, cafes and pubs. It applies for a maximum discount of £10 per head (excluding alcohol) and can be used from Mondays to Wednesdays, with no limit on the number of visits. Individuals will not be issued with physical vouchers. The hospitality provider will do all the administration
  • Hospitality businesses can claim the money back, with funds transferred to their bank account within five working days. The scheme, described as the first of its kind, is designed to help an industry employing 1.8 million people
  • VAT on food, accommodation and attractions will be cut for the next six months from 20% to 5% – a “£4bn catalyst” for the sector designed to protect 2.4 million jobs
  • The cut – which applies from next Wednesday 15th July and runs until Tuesday 12th January 2021 – covers food from restaurants, cafes and pubs (both eat in and take away), accommodation in hotels, B&Bs and caravan sites, and attractions such as cinemas, theme parks and zoos

Help for the Property Sector:

  • The threshold for paying stamp duty will be raised temporarily from £125,000 to £500,000 until 31st March 2021, resulting in the average stamp duty bill falling by £4,500
  • The measure, designed to boost confidence in the housing market after a slump in transactions, is expected to mean nearly nine out of ten people buying a main home this year paying no duty at all

Help for Jobs & Employment:

  • A jobs retention bonus will reward employers who bring back workers from furlough with a single grant of £1,000 per employee, provided that each employee is in work for at least 25 hours per week and completes at least two months of continuous employment between now and 31st December 2020. The £1000 payments to employers are expected to be paid in January 2021. All nine million of those currently on furlough will qualify
  • As previously announced, the Government’s furlough scheme will wind down with monthly decreases in percentage support and will end completely on 31st October 2020
  • £1.2bn has been pledged to the Department for Work and Pensions “to support millions of people back to work” through a substantial ramping up of Jobcentre support and activities
  • Firms will be paid £1,000 to take on trainees, with £100m pledged to fund places in high-demand sectors such as engineering, construction and social care
  • £2bn made available for “Kickstart” scheme for young people – with no cap on the number of places available
  • The new ‘Kickstart’ scheme will pay employers to create new jobs for hundreds of thousands of 16-24 year olds at risk of long-term unemployment. Each new job must be for a minimum of 25 hours per week, paid at least the national minimum wage rate

Help to support Green Measures in the Housing/Buildings Sector:

  • Green measures totalling £3bn aim to make 650,000 homes more energy efficient, save households £300 a year on bills and support 140,000 jobs, many of which jobs will be new and will create opportunities for new and existing small SME’s
  • £1bn of funding to improve the energy efficiency of public sector buildings
  • A £2bn green homes grant will deliver vouchers to homeowners and landlords to make their homes more energy efficient. The current voucher proposal is for £5000 per home but this figure may be increased in areas of high social deprivation

How to check if your business qualifies and how to apply for these schemes:

  • Because these proposals need to complete their legal passage through Parliament (they are known technically as ‘Statutory Instruments’) it is likely that qualification criteria and online application portals will be available by next Wednesday 15th July.
  • We will advise you of these once they have been set up.

Access to the details of the Chancellor’s measures:

If you would like to read the full text of the Chancellor’s measures you can do so by clicking the button below