Furlough – Coronavirus Job Retention Scheme (CJRS)
The furlough scheme will be extended until the end of April 2021 which means that it will remain at the current level of 80% of usual wages for the hours not worked.
The end of April is also the date planned for unveiling the next phase of the coronavirus economic support plan.
A list of the key furlough claim dates:
Also announced was that businesses will have until the end of March to access the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Large Business Interruption Loan Scheme, all of which had been set to close at the end of January.
A successor loan scheme is planned to be unveiled in the Budget on 3 March.
Economic consideration – How will the Government pay for the Coronavirus crisis?
The coronavirus crisis has led to soaring public spending and this year alone the government is spending £280bn on measures to support the UK economy, including £73bn on job support schemes.
The Institute for Fiscal Studies reported in June that there are indications that the coronavirus crisis has increased income inequality, with the bottom 10% of earners expected to lose their jobs.
The Wealth Tax Commission have said that a one-off “wealth tax” would be the best way to patch up UK public finances and rather than increasing income tax or VAT, the government should instead look at a tax on millionaire couples.
Taxing those households an extra 1% above a £1m threshold could raise £260bn over five years and would be equivalent to raising VAT by 6p or the basic rate of income tax by 9p for the same period.
The suggested tax would include all assets such as main homes and pension pots, as well as business and financial wealth, but not debts such as mortgages and would be paid by any UK resident, including “non-doms”.
Taxing high-net-worth individuals in this way would not discourage economic activity and would be very difficult to avoid by moving money offshore or by emigrating.
One-off taxes have been used after major crises before and this week Argentina passed a tax on the wealthiest to pay for the ongoing coronavirus pandemic.