Budget 2020 includes £30bn coronovirus package
The Chancellor Rishi Sunak has presented his first Budget today, unveiling a £30bn package to boost the economy and get the country through the coronavirus outbreak.
He is suspending business rates for many firms in England, extending sick pay and boosting NHS funding.
In his first Budget speech, he warned of a "significant" but temporary disruption to the UK economy but vowed: "We will get through this together."
Here are some of the key points of the Budget:
Measures announced in response to the coronavirus outbreak
- A £5bn emergency response fund has been announced to provide support to the NHS and other public services
- In addition, a £500m hardship fund has been announced for councils to help vulnerable people
- Statutory sick pay will be paid to all those who are advised to self-isolate, even if they have not presented with symptoms
- Self-employed workers who are not eligible for sick pay will be able to claim contributory Employment Support Allowance (ESA). This will be available immediately after going on sick
- Sick pay payments for two weeks will be refunded for firms with fewer than 250 staff
- "Business interruption" loans of up to £1.2m will be available to small businesses who face disruption as a result of coronavirus
- Business rates in England will be abolished for firms in the retail, leisure and hospitality sectors with a rateable value below £51,000
Business and personal taxes
- Cutting of corporation tax from 19 to 17 percent has been scrapped, so this remains at 19 percent
- The tax threshold for National Insurance Contributions will rise from £8,632 to £9,500
- 5% VAT on women's sanitary products, known as the "tampon tax", to be scrapped
- Fuel duty to be frozen
- Duties on spirits, beer, cider and wine to be frozen
- Business rate discounts for pubs to rise from £1,000 to £5,000 this year
What does this budget mean for you?
Affected by coronavirus?
Under Mr Sunak's new measures, statutory sick pay (SSP) will be extended to all of those who are eligible and asked to self-isolate, even if they are not showing symptoms.
Those who are not eligible for sick pay, particularly the self-employed, will be able to claim Employment and Support Allowance (ESA) from day one of "illness" rather than day eight. ESA is paid to those who are too sick to work, provided they meet certain conditions. It is worth £73.10 a week, or £57.90 for the under-25s.
The income tax allowance is frozen at £12,500. This is the amount you can earn before you start to pay 20 percent income tax. Also frozen is the £50,000 threshold at which people start to pay the higher 40 percent rate of income tax.
Those working from home, who can currently claim £4 a week off their income tax bill, will be able to claim £6 from April.
National insurance cut
The current national insurance limit means that employees and the self-employed start to pay contributions once they earn £166 a week, equivalent to an annual salary of £8,632 a year. From April, you start paying when earning £9,500. For those paying national insurance, this should save them up to £85 a year on average.
National Living Wage increase
Those aged 25 and over will get the National Living Wage of £8.72 an hour, a rise of 6.2%, with younger workers also getting more. This is paid by employers.
Savings for children
A lot more can be put into tax-free savings for children. The allowance for Junior ISAs (Individual Savings Accounts) and Child Trust Funds will be increased from £4,368 to £9,000 in April.