Budget 2020: 'the biggest spending spree in decades...'
12th March 2020
The first Budget since 2018 was delivered by Rishi Sunak yesterday afternoon, after just 27 days in his new role. The Government's substantial majority gave the new chancellor carte blanche to overhaul taxes but, in the end, there were relatively few substantial changes.
The coronavirus (COVID-19) was certainly high on the agenda, with a £5bn emergency response fund announced to support the NHS and public services. Importantly, there have been interim changes made to statutory sick pay and the Employment Support Allowance to ensure those who need to self-isolate can do so without such a worry of lost income.
The 2020 economic growth forecasts were not promising as the figures were cut from 1.4% to 1.1%, and this figure doesn't include the potential shock to the economy due to COVID-19.
On the tax front, the National Insurance Contributions will rise from £8,632 to £9,500. Corporation tax is sticking at 19% and the employment allowance will rise to £4,000. The Entrepreneurs' Relief limit will drop from £10m to £1m, VAT on women's sanitary products will be scrapped altogether, and digital publications will become zero-rated.
Sunak also announced cash grants of £3,000 for businesses with rateable values of less than £15,000 and a temporary loan scheme for SMEs.
Duties on fuel, spirits, beer, cider, and wine are to be frozen while most tobacco duties will increase by RPI plus 2% with immediate effect.
Over the next few days, our tax team will be looking at the announcements in more detail. Keep an eye on our social media pages and blog for further insight into how the changes will affect you.