The ‘Economic Update’ by the Chancellor, Rishi Sunak, arrived six months and a day after the Prime Minister announced the start of lockdown on 23 March. Twelve days earlier the Chancellor had made his Budget debut, announcing a “temporary, timely and targeted” package of measures to “deal with the coronavirus”. Their estimated total cost was £12 billion.

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Highlights

  • A new Job Support Scheme, primarily targeted at small and medium employers, will be introduced covering employees who work at least one third of their normal hours
  • The Chancellor confirmed that the furlough scheme will end on 31 October.
  • The Self-Employment Income Support Scheme (SEISS) will be extended to April 2021, with a revised basis.
  • The closure date for the four existing business loan schemes will be extended to the end of November.
  • Repayment terms for the Coronavirus Business Interruption Loan Scheme (CBILS) and Bounce Back Loans (BBLS) will be relaxed, with the maximum term extended to 10 years.
  • The reduction in VAT to 5% for the hospitality and tourism industries will be extended to 31 March 2021.
  • The deferred VAT and self-assessment payments due early next year can be repayable in instalments rather than as a lump sum.




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