What can we expect on 3rd March?
The chancellor is due to make his next Budget Announcement open 3rd March 2021. It seems like an absolute age ago that we were sat down waiting to see what this new chancellor was going to announce. After all he had only been in the job a few days following the shock resignation of his predecessor. This all paled in to insignificance due to the emerging Covid Pandemic. I am sure that like me, you cannot remember the whole content of the Budget, as so much of it changed within days. The Covid Pandemic caused the announcement of support for hospitality businesses, support for businesses affected by Covid and the establishment of a short term Furlough Scheme (Coronavirus Job Retention Scheme). There were further announcement's to follow including the Self Employed Income Support Scheme, Coronavirus Job Support scheme (for keeping on staff following the end of the CJRS). We are now nearly a year on from the last budget and this weekend see's the one year anniversary of the return of the first Covid patients from Wuhan on that seemingly empty plane flying in, to be greeted by buses taking the patients to quarantine.
As the 3rd March approaches, there have been lots of rumours about increasing corporation tax rate from 19% up to 21%, with some anticipating a rise to 24%. There have been suggestions of increasing VAT or removing the triple lock on pensions alongside the introduction of greater taxation on the self employed. One thing that we can all agree on is further announcements of support for business and individuals whilst we will still battle with the Covid Pandemic. It is expected that the CJRS Scheme will be extended for a further three months (at least) till July 2021. There is pressure on the government to make a change to the SEISS No. 4 Grant to include those ignored self employed people who have not qualified for Grants 1 through 3.
The timing of the budget so closely to the withdrawal of the £20.00/Week lift in Universal Credit for individuals on benefits may help people on these benefits faced with this reduction. it is expected that the withdrawal of the £20.00/Week protection will still take place, however the government is said to be considering a one-off lump sump of £1000 to recipients of these benefits. The pitfalls of this one-off bonus is that the recipients may use the money differently when delivered in a one-off rather than in a weekly/monthly support payment.
Whatever we think as individuals/businesses regardless of our political beliefs, the 3rd March Budget is the opportunity for the government to continue life support that our economy needs in order that some level of normality will be maintained once this pandemic has passed.