HURST comments on summer economic update

Date: 08/07/2020
Author: HURST
Company: HURST

Adrian Young, tax partner at accounting and business advisory firm HURST, said: “Rishi Sunak’s Summer Economic Update today was sober in its delivery, reflecting how seriously the government is taking the economic fall-out from the pandemic.

“Mr Sunak described the update as a ‘Plan for Jobs’, consisting of numerous measures to support, create and protect employment.

“This jobs plan was described as a mid-point between the initial ‘protection’ response to the pandemic, and the well-trailed ‘rebuild’ phase which will begin in earnest once the autumn spending review has taken place.

“Despite his sombre tone, Mr Sunak announced a number of noticeable measures. Perhaps the most eye-catching is the jobs retention bonus scheme, which will reward employers with £1,000 for each employee they bring back from furlough, along with a raft of new measures aimed at getting younger people into secure employment.

“This positive message was balanced with the acknowledgement that the current furlough scheme cannot continue indefinitely, and will be gradually wound down between now and the autumn.

Other welcome developments announced today include an increase in the threshold at which stamp duty becomes payable from £125,000 to £500,000, and a reduction in the VAT rate from 20 per cent to five per cent for the hospitality and tourism sectors.

“The ‘eat-out-to-help-out’ 50 per cent discount scheme is perfectly-timed with the summer break to encourage people to get out and spend, a key driver in the UK’s consumption-led economy.”