Summer Economic Statement
On Wednesday 8th July, the Chancellor Rishi Sunak made a speech entitled “Summer Economic Update” where he unveiled further Government supports and he unveiled the Government’s plan for jobs which he described as the “Second phase in the Government’s economic response to the crisis.”
Here are the highlights and we will update you on the details in the next few days as the Government publishes the specifics of the supports.
CORONAVIRUS JOB RETENTION SCHEME (CJRS) AND JOB RETENTION BONUS
The CJRS ends in October and the Chancellor looked to cushion expected redundancies with the announcement of a Job Retention Bonus (JRB). The new scheme will give employers £1,000 for each previously furloughed employee they retain and keep in employment until January 2021, as long as they are paid at least £520 a month. Further details of the scheme are expected later in July.
VALUE ADDED TAX REDUCED RATE FOR HOSPITALITY AND TOURISM SECTORS
The Chancellor outlined a VAT rate cut for the Hospitality and Tourism sectors from 20 per cent to five per cent. The measures relate specifically to food and non-alcoholic drinks and to accommodation and admission to attractions, with further details expected to be published later.
The VAT rate change comes into effect on Wednesday 15 July 2020 and will be in place temporarily until 12 January 2021.
EAT OUT TO HELP OUT
The “Eat Out to Help Out” scheme will provide a discount of 50 per cent of up to £10 a person on eat-in meals, including non-alcoholic drinks, at participating establishments on Mondays, Tuesdays and Wednesdays for the month of August.
Restaurants, cafes and pubs can sign-up for the scheme on a new website on Monday 13 July 2020.
The government will introduce a new Kickstart Scheme in Great Britain , a £2 billion fund to create hundreds of thousands of high quality 6-month work placements aimed at those aged 16-24 who are on Universal Credit and are deemed to be at risk of long-term unemployment. Funding available for each job will cover 100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions.
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