Budget 2021 - top takeaway info and what it means for Heswall and the district

First things first, if you fancy an 'essential' drink so you can reflect on the Budget while feeling mellow, the good news is that you can drive to the off-licence in the knowledge that alcohol and fuel duties have been frozen.

A great deal of what Chancellor Rishi Sunak said this lunchtime in the House of Commons had been heavily trailed beforehand, but now we know for sure that, in a nutshell:

- the furlough scheme has been extended

- a multi-billion pound restart scheme will be available to the hospitality sector

- the stamp duty holiday goes on

- likewise the business rates holiday

- and that the Community Ownership Fund Heswall Nub News discussed yesterday will become a reality, aiming to put cash and decision making in the hands of local people to help them improve the places in which they live.

These are some of the key points from Mr Sunak's 50 minute speech.

Additional support for workers and jobs

Earlier this week the chancellor said this was to be a Budget "that provides support for people" - as unemployment hovers around 5% and four million workers are on furlough.

Today Mr Sunak announced the furlough support scheme will be extended until the end of September, with employers asked to contribute to workers' salaries from July.

From then, employers will be expected to contribute 10%, increasing to 20% in August and September, as the economy opens up again and gathers momentum.

Employees will continue to receive 80% of their salary for hours not worked until the scheme ends.

Support for the self employed will also continue until September, and access to the scheme will be made easier. Assuming they had filed tax returns by midnight last night, 600,000 self employed people will now be able to take advantage of it.

The Chancellor also extended a £20-per-week uplift to Universal Credit for six months, after intense pressure from MPs and charities to do more to help the less well off navigate their way through the pandemic.

Help for hospitality and other sectors

We know that Heswall has a wide and varied hospitality offer, and that the sector has felt badly neglected, going so far as to demand the role be created for a Minister for Hospitality - so it will be interesting to see if local business people in this sector consider this enough.

A £5 billion scheme will give hospitality businesses access to grants worth up to £18,000. These restart grants will be available on a per premises basis and also cover gyms, personal care and leisure firms, and will be calculated on the rateable value of the property.

The 5% reduced rate for VAT for tourism and hospitality will be extended for six months to the end of September.

Culture and Sport

£700 million will be made available for the arts, culture and sport as venues are able to reopen in line with the government's roadmap out of lockdown.

£400 million of this cash has been set aside to help museums, theatres, galleries and live music venues reopen in the coming months - meaning that Heswall Hall might be eligible to take advantage of it.

Business rates

These, along with rents, are always quoted by Heswall Nub News readers as the main barrier to entry for anyone wishing to start a local business requiring premises.

MPs across the parties say the tax, which is calculated using the value of a company's premises, is out of date and simply unfair. The boss of Next, Lord Simon Wolfson, recently said that a huge number of shops will have to close unnecessarily if the rates system is not reformed, and said the tax should be slashed by at least 35%.

That debate goes on, but today the Chancellor extended the business rates holiday brought in last year to support shops beyond its current end date of March 31st and into the summer.

Taxes

In 2023 Corporation Tax will rise to 25%, but the Chancellor pointed out that the UK will still have the lowest such rate in the G7. He also added that he is creating a Small Profits Rate to ensure only businesses with profits of over £250,000 will be taxed at the 25% rate.

"That means only 10% of all companies will pay the full higher rate," he said.

On income tax, the threshold for paying the basic rate will rise to £12,570 next year. For higher-rate payers, the threshold will be £50,270, and both rates will stay the same until 2026.

The VAT registration threshold will remain at £85,000 until 2024.

Stamp duty holiday extension

The stamp duty holiday introduced last year not only propped up the housing market at the start of the crisis, but also ramped up the average value of a home by 8.5% in 2020.

That tax break was scheduled to end on the 31st of this month, leaving many buyers facing major losses if they didn't complete their transactions on time. However, today Mr Sunak extended the stamp duty holiday until June, and the edge of the abyss facing some buyers went out of sight. And he added: "Then, to smooth the transition back to normal, the nil rate band will be £250,000, double its standard level, until the end of September – and we will only return to the usual level of £125,000 from October 1st."

Because first time home buyers often struggle to find a substantial deposit, the government mortgage guarantee scheme will offer 95% mortgages for houses worth up to £600,000.

It is based on the Help to Buy mortgage guarantee scheme, which closed to new loans at the end of 2016, and aims, as the government puts it, "to turn Generation Rent into Generation Buy".

In the short term, the Budget gave away; but in the long term the public finances will have to claw back. On Wednesday there was little to carp about with regards to taxation and cuts - but the softly-softly approach can only last so long.