The chancellor, Rishi Sunark, has announced his new budget which includes massive implications for the United Kingdom’s financial exist strategy from the pandemic.
Some of the key decisions see the continuation of furlough until the end of September, a freeze on VAT and an increase in corporation tax.
Now businesses in Highland Perthshire, and the rest of Perth and Kinross, are welcoming the news from the chancellor, albeit with some reluctance on the changes to tax and implementations of policy.
Vicki Unite, Perthshire Chamber of Commerce Chief Executive, said: “We welcome the help for those businesses, especially in hospitality and tourism, still struggling with the ramifications of COVID.
“The promise of the expected extension of the furlough scheme to June, then a tapering off until September, will provide many with an opportunity to continue and plan for the future, and safeguard thousands of jobs.
“We have been adamant about the necessity to continue the Coronavirus Jobs Retention Scheme and the widening of the self-employment support scheme, so we are glad that these measures are still in place.
“We have been calling too for an extension of VAT reduction for the hardest hit sectors, coupled with investment incentives, so we are reassured that the Chancellor has announced both of these.”
Addressing parliament, the chancellor aired his concern for the shrinkage in the British economy, but also his optimism for the future with predictions indicating a ‘long’ recovery.
He said: “”Our economy has shrunk by 10% – the largest fall in over 300 years. Our borrowing is the highest it has been outside of wartime.
“It’s going to take this country – and the whole world – a long time to recover from this extraordinary economic situation. But we will recover.”
As part of the recovery, corporation tax is rising from 19% to 25% by 2023 for businesses earning profits above £250,000. Leaving small businesses exempt from the 6% rise.
Vicki Unite added: “Alongside other new measures to help businesses recruit and re-open in the short term this all seems positive though there are still a significant number of business owners excluded from Government support, which is disappointing, and we would hope further support could be forthcoming.
“Businesses will also resent the increase in Corporation Tax, although smaller companies will appreciate the lower rate and the time-lagged approach will help larger organisations adjust before the increases are applied.
“We hope too that Perthshire businesses will get a fair share of the extra £1.2billion in consequentials allocated to Scotland, and that those who need it most will get crucial working capital from the new UK-wide Recovery Loan Scheme.
“Overall this was projected as a ‘Restart and Rebuild’ budget and hopefully continued Government assistance and intervention, if required, in the months ahead will go some way to achieve that.”