To get businesses through the last few months of restrictions and aid recovery Rishi Sunak’s Budget delivered at the start of this month and described by some as ‘the most important Budget for business in a generation’ focused on securing economic recovery and ensuring business stability rather than clawing back some of the £280bn already spent since the start of the pandemic.
The Budget included an extension to some of the existing support measures, including the furlough scheme until September, and introduced the new Recovery Loan Scheme which will offer loans from £25,000 to £10m up to the end of the year. The current VAT cut (5% rate) for tourism and hospitality businesses was also extended until 30th September and business rates relief for the retail, hospitality, and leisure industry will also continue to the end of June.
During his announcement the Chancellor said the economy shrunk by 10% over the last year but also promised a ‘swift’ recovery. He said the economy is forecast to grow by 4-5% in 2021 and 7.3% in 2022 – the strongest level of growth since 1941.
Overall, optimism for recovery seems high. The GDP figures for January were better than expected, falling only 2.9% compared to the expected 5% and the OECD recently increased its UK growth forecast for the year from 4.2% to 5.1%.
Via TMA UK.
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