• Chancellor Rishi Sunak revealed the Budget in the House of Commons this afternoon.
  • An extension to the furlough scheme, continued VAT cuts and extended business rate holidays were announced.
  • We heard from a Harrogate accountant to talk about the key points and what they mean for local businesses.

Chancellor Rishi Sunak outlined the government’s tax and spending plans as they bid to save jobs and prevent businesses collapsing due to the pandemic.

Mr Sunak’s Budget announcement in the House of Commons this afternoon included the extension of the furlough scheme and VAT cuts for hospitality firms until September, and will see no changes to income tax, national insurance or VAT.

Here are the key points from the Budget:

Business

  • The furlough scheme will  be extended until the end of September, with the government paying 80% of employees’ wages for hours they cannot work.
  • Employers will then be asked to contribute 10% in July and 20% in August and September.
  • Minimum wage will be increased to £8.91 an hour from April.
  • £5bn in reopening grants will go to non-essential businesses (up to £6,000 per premises).
  • 5% VAT cuts for hospitality will continue until September.
  • Business rates holiday for firms in England will continue from April until June.

Taxation

  • No changes to rates of income tax, national insurance or VAT.
  • Corporation tax on company profits will rise from 19% to 25% in April 2023.
  • Rate to be kept at 19% for around 1.5 million smaller companies.

The arts

  • £400m will go to arts venues in England to help them reopen, including museums and galleries.

So what does this mean for local businesses?

Your Harrogate’s Nick Hancock caught up with Robin Stride, Accountant at R Stride & Co in Harrogate, to talk about the key points from the budget and discuss how people and businesses will be affected:

Sean Clarke from DoorsDirect in Harrogate gave his reaction:

“It’s great to see the business rates extended, and of course the furlough scheme. We don’t have an abundance of staff but when we’ve had to make use of it we have done, and there’s a lot of businesses out there that rely on it.

“Obviously as a local business, we love local business and we love our local customers. It’s always great when we get to see them, but with covid restrictions we haven’t had many visitors down to our show room, which is always disappointing because it’s nice to see people!

“But we understand everything that’s going on and we’ve put measures in place. Hopefully soon that will all change and people can start coming back down and enjoying my great coffee!”

Chief Executive of Harrogate Theatre David Bown said:

“The extension of the furlough scheme will allow us to bring staff back in a measured manner when theatres are allowed to open once more.

“We eagerly await the detail of the £400m pledged to help the arts sector reignite and hope it will allow for the rebuilding of the industry’s infrastructure and the creation of new and exciting work.”

Read more local stories from Your Harrogate here.