An emergency fund to help businesses through the coronavirus outbreak and a tax on plastic packaging were announced during today’s budget.
During his debut budget, Chancellor Rishi Sunak, who was recently installed to replace Savid Javid, announced a package of financial schemes for individuals and businesses to alleviate the strain of the spread of Covid-19.
Business owners and employees that are struggling under the spread of the contagion will gain access to tax cuts, statutory sick pay and emergency loans.
An exceptional business rates holiday will be implemented for retailers, hospitality companies and businesses in the leisure industry with a rateable value under £51,000. It means almost half (45 per cent) of business properties in England will receive full business rates relief this financial year. This is on top of previously announced retail business rates discounts, which will be increase to 50 per cent in 2020-21.
To boost cash flow, a temporary Coronavirus Business Interruption Loan Scheme will be launched by the government and delivered by the British Business Bank to give businesses access to loans and overdrafts. Lenders will be given a guarantee of 80 per cent on each loan by the government to boost confidence in financial backing for SMEs, such as independent retailers. Neither banks nor businesses will be charged for the guarantee, which will support up to £1bn in additional cash loans.
Statutory sick pay will also be extended for workers forced to self-isolate due to the coronavirus, or care for others in isolation. The 14-day sick pay will be paid by employers, but businesses with fewer than 250 staff will be able to reclaim the cost.
In non-coronavirus news, a forward-looking measure to promote the use of more recycled plastic in the packaging of goods will come into effect from 2022.
The Chancellor said the Plastics Packaging Tax aims to “tackle the scourge of plastic waste” by imposing a £200 per tonne levy on plastic boxes and wrapping materials with lower than 30 per cent recycled content.
Businesses now have two years to source a solution and revamp their supply chain, or face
The plastic tax forms part of a tranche of wider green initiatives to cut down on the environmental impact of industry, including higher tax on gas and the end of tax relief for red diesel, the until-now low-cost fuel used in off-road vehicles such as tractors and construction plant – though farmers will be exempt.