Rishi Sunak vows to use Budget to build 'fairer and more just country' in memory of those lost to Covid

RISHI Sunak tonight vowed to build a "fairer and more just" Britain in memory of the thousands of people lost to Covid in the past year.

The Chancellor said he knew many millions of families would be overwhelmed by their grief, but vowed to "meet this moment with passion and energy".

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The Chancellor today revealed huge chunks more spending to MPs in the House of Commons, where he promised to look after the nation through the rest of the crisis.

Mr Sunak, delivering only his second Budget since becoming Chancellor last year, confirmed he would extend a range of vital support measures including the VAT cut, furlough, stamp duty cuts and more to get the nation through the worst of the pandemic.

And he vowed to plough more money into investment for years to come to take advantage of low interest rates and start the work of "building our future economy".

He promised to help struggling Brits with "more support to get people through to the other side of the crisis".

He told the nation today: "Much has changed. But one thing has stayed the same. I said I would do whatever it takes; I have done; and I will do."

Financial experts predicted a bumper 7 per cent growth in GDP next year – which would be the strongest set of figures since World War II.

And the UK economy would completely recover from the pandemic by the middle of next year, with a huge bounce back starting from when the restrictions are lifted, they claim.

They also said as a result of the latest measures they think unemployment will be 340,000 lower than previously thought – with thousands of jobs saved.

But coming down the track he revealed billions of pounds worth of stealth tax rises would come in over the next five years – including corporation tax hikes, capital gains and freezing several other perks.

The Chancellor said he had to begin the "painstaking" process of rebuilding the public finances and admitted they "might not be popular but they are honest".

The nation's financial experts at the OBR warned today it would increase the tax burden to 35 per cent – rates not seen since the 1960s.

He confirmed today:

  • Furlough will be extended for six months until the end of September – with employers coughing up contributions from July onwards
  • Thousands more people will be brought into the self-employment help schemes
  • A fourth self-employed grant of up to £7,500 and a fifth one will come over the summer
  • Fuel duty will be frozen yet again in a huge win for The Sun's Keep It Down campaign
  • The UK’s Covid vaccine rollout will receive a £1.65 billion boost
  • Universal Credit's £20 a week boost will continue for another six months – while those on Working Tax Credits will get an extra £500 one off payment
  • The National Living Wage will rise to £8.91 from April
  • The VAT cut will be extended for another six months – and then it will go up to 12% for another six months after that
  • Rishi pledged £2.8million for Britain's bid to host the 2030 world cup
  • The Stamp Duty Holiday was extended for another three months in full – and will taper down for three months after that for properties up to £250,000
  • A new mortgage guarantee scheme will offer 95 per cent loans to first-time buyers to get on the ladder
  • He will freeze the income tax brackets, meaning Brits will no longer benefit from planned increases to the amount that can be earned tax-free
  • The price of a pint will be be frozen as Rishi Sunak scraps alcohol duty rises
  • Brits can get up to £1million as part of a £150million fund to rescue pubs and football clubs from closure
  • Grant funding will be available to businesses in England through a new £5 billion Restart Grant scheme to help the high street
  • A new freeport scheme will come in giving tax breaks for firms in eight areas of the country

Earlier today the Chancellor addressed Cabinet alongside the PM, saying that "the coronavirus pandemic has hit our economy hard".

He vowed he was "optimistic about our recovery" and Britain's ability to bounce back.

Yet he stressed the nation must not forget how much cash has been borrowed "on an extraordinary scale – equivalent only to wartime levels".

He insisted: "As a Conservative Government, we know that we cannot ignore this problem and it wouldn't be right or responsible to do so.

"We will rise to that challenge".



PERSONAL FINANCES

The Chancellor announced a freeze to income tax thresholds, meaning Brits will no longer benefit from planned increases to the amount that can be earned tax-free.

But he said the tax-free personal allowance will remain at £12,500.

Most people can earn this amount before being taxed at the basic rate of 20 per cent on any earnings over that.

The threshold for paying higher rate tax of 40 per cent will also be frozen at £50,000.

But he vowed he would stick to his promises not to raise VAT, income tax of national insurance.

Universal Credit will keep the £20 a month uplift for another six months.

And people claiming working tax credits can expect a £500 one off payment to help them through the Covid crisis.


FURLOUGH FOR MONTHS

The Chancellor confirmed he will extend furlough until the end of September.

It means 80 per cent of people's wages will continue to be paid for months to come, to help firms get back on their feet again.

From July, though, the businesses will be asked to chip in, as the Chancellor tries to wean them off the cash help they will have been getting for 17 months.

In July, employers will be expected to contribute 10 per cent of the cost, increasing to 20p per cent in August and September, as the economy reopens.

The Coronavirus Job Retention Scheme has protected more than 11 million jobs since its creation last March, with Mr Sunak promising further help in the "challenging months ahead – and beyond".

MORE GRANTS AND SELF EMPLOYED HELP

Mr Sunak revealed extra help for 600,000 self employed Brits who have been shut out of Government support during the pandemic.

The Chancellor confirmed that hundreds of thousands of people, many of whom became self-employed in 2019-20, will now be able to claim direct cash grants under the Self-Employment Income Support Scheme.

Previously they could only claim if they had filled in a recent tax return, which meant millions were shut out.

The Treasury has also confirmed it will give a fourth grant of up to £7,500 to the self-employed.

And a fifth one will come over the summer – in line with the furlough extension.

BRITAIN'S BOUNCE BACK

The PM and Chancellor are under huge pressure to help sectors of the economy which have struggled over the last year of the pandemic.

The public will get up to £1million to rescue their local pub or footie club from closure, The Sun revealed earlier this week.

The Chancellor pledged a whopping £150 million to help neighbourhoods take over assets loved by the community.

He also increased the contactless spending limit to £100 to try and encourage more spending, and boost the nation's shops.

But he batted away calls for a 'Shop Out to Help Out' voucher scheme.

And the Chancellor announced a 'super deduction' tax break for businesses – where firms will get 30% tax back.

It means that when companies invest they will be able to claim the cost of the goods and an extra third on top of that – in a hope it will encourage businesses to go greener.

The Business rates holiday will also be extended until July.

TAX RISES

Corporation tax will be hiked to 25 per cent, Mr Sunak announced today in a sting for big businesses.

The Chancellor said the rate will be raised from 19 per cent from April 2023 as he looks to plug the huge black hole in the country's pandemic-ravaged finances.

It marks a screeching reversal of the UK's decade-long drive to cut corporation tax, which was slashed from 28 per cent in 2010 by then-Conservative chancellor George Osborne.

He also revealed hikes to Capital Gains Tax, which will tax people on their extra profits.

HARD TIMES

With the nation’s coffers reeling from the Covid crisis, Mr Sunak is staring at £400billion blackhole.

The chief bean counter today set out his “a three-point plan to protect jobs” – but also gave the nation a reality check over the dire economic situation left in the wake of the pandemic.

He said the OBR money chiefs predicted a bumper growth year – growing by 4 per cent this year, followed by a huge 7.3 per cent next year.

That would be the strongest set of figures since World War II.

The UK economy would completely recover by the middle of next year, they say.

Mr Sunak said: "The Office for Budget Responsibility are now forecasting, in their words: 'A swifter and more sustained recovery' than they expected in November.

"The OBR now expect the economy to return to its pre-Covid level by the middle of next year – six months earlier than they previously thought.

"That means growth is faster, unemployment lower, wages higher, investment higher, household incomes higher."

He added however, that "repairing long term damage will take time".

He also warned today that the time to get the nation's books in order is rapidly approaching.

Only once the economy is on a better footing will he start his plans to fix the public finances in earnest.

 

 

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