The Chancellor today announced a boost for the hospitality sector through a raft of measures to help speed up economic recovery as we emerge from the Covid-19 crisis. From VAT cuts for the hospitality sector to a boost for eating out, the package supports jobs, businesses and the housing market. Marble Arch London BID welcomes this injection, following extensive lobbying as part of our Recovery Plan, to bolster businesses and jobs in the hardest hit sector across our district.
Hospitality VAT Cut from 20% to 5%
The rate of VAT applied on most tourism and hospitality-related activities will be cut from 20% to 5% from next Wednesday 15 July until 12 January 2021. This cut will apply to eat-in or hot takeaway food from restaurants, cafes and pubs, accommodation in hotels, B&Bs, campsites and caravan sites, attractions like cinemas, theme parks and zoos.
Guidance on reduced VAT rate for hospitality, holiday accommodation and attractions can be found here.
Eat Out to Help Out Discount
To encourage people to safely return to eating out at restaurants the Government’s new discount scheme will provide a 50% reduction for sit-down meals in cafes, restaurants and pubs across the UK from Monday to Wednesday every week throughout August 2020, up to a maximum discount of £10 per head. Alcohol is excluded.
Mr Sunak says the “Eat Out to Help Out” discount would help protect 1.8 million jobs.
Businesses will need to register, and can do so through a simple website, open next Monday. Each week in August, businesses can then claim the money back, with the funds in their bank account within 5 working days.
Click here to find out more about the Eat Out to Help Out scheme, including how to register for the scheme.
Posters, images and other promotional materials for use by establishments who are taking part in the Eat Out To Help Out Scheme can be found here.
Job Retention Bonus
The Chancellor also announced a Job Retention Bonus, giving £1,000 to businesses who bring back employees from furlough. The government will also pay firms a £1,000 bonus for every staff member kept on for three months when the furlough scheme ends in October.
“If you’re an employer and you bring back someone who was furloughed – and continuously employ them through to January – we’ll pay you a £1,000 bonus per employee. So for businesses to get the bonus, the employee must be paid at least £520 on average, in each month from November to the end of January – the equivalent of the lower earnings limit in National Insurance.”
A new £2 billion scheme will also be launched to create hundreds of thousands of new, fully subsidised jobs for young people across the country. Those aged 16-24, claiming Universal Credit and at risk of long-term unemployment, will be eligible. Funding available for each six-month job placement will cover 100% of the National Minimum Wage for 25 hours a week – and employers will be able to top this wage up.
Employment and support schemes
A total of £1.6 billion will be invested in scaling up employment support schemes, training and apprenticeships to help people looking for a job. The plan will also create tens of thousands of jobs through bringing forward work on £8.8 billion of new infrastructure, decarbonisation and maintenance projects. In addition, £5.8 billion will be spent on shovel-ready construction projects to get Britain building.
A temporary increase to the Nil Rate Band of Residential SDLT (Stamp Duty) from £125,000 to £500,000 has been introduced until 31 March 2021.
Full details of the announcement can be found here.