Chancellor Rishi Sunak delivered his 2021 Budget in the House of Commons on Wednesday. Setting out the government's tax and spending plans for the year ahead, he announced new measures to help support businesses and jobs through the pandemic in order to ensure the UK's long-term economic recovery.

With over £280 billion of support already made available since March 2020, the Budget also laid out a set of tax raises to help balance public finances. With the OBR predicting that the economy could bounce back six months earlier than predicted, the Chancellor delivered assurance that the measures put in place to protect and rebuild the economy are working.

Here is a summary of the main points from this year’s Budget:

• The personal income tax allowance is to be frozen at £12,570 from April 2022 to 2026 with the higher rate income tax threshold to be frozen at £50,270 from 2022 to 2026
  
  
• Universal Credit top-up of £20-per-week will continue for a further six months and the minimum wage to increase to £8.91 an hour from April
  
  
• The furlough scheme - which pays 80% of employees' wages - will be extended until the end of September. Employers will be asked to contribute 10% in July and 20% in August and September
  
  
• Support for the self-employed will also be extended with 600,000 newly self-employed also eligible for help, providing they have completed a tax return for last year. Those whose turnover has reduced by more than 30% will be entitled to a grant of 80% of their average turnover; with those whose turnover has reduced by less than 30% entitled to a grant of 30%
  
  
• All alcohol duties to be frozen for the second year running and fuel duty to be frozen for the eleventh consecutive year
  
  
• The 500,000 nil rate band for stamp duty will extend beyond the 31st of March, and instead will end on the 30th of June. Then, to smooth the transition back to normal, the nil rate band will be £250,000, double its standard level, until the end of September – we will only return to the usual level of £125,000 from October 1st.
  
  
• With effect from April 2023 there will be a return to staggered rates of Corporation Tax. These will be a ‘small profits rate’ of 19% for companies with profits below £50,000, a ‘main rate’ of 25% for companies with profits above £250,000, and a form of taper relief for companies with profits between £50,000 and £250,000.
  
  
• The Chancellor has also announced a new ‘super deduction’ for companies making capital investment into their businesses. Qualifying expenditure will benefit from a first-year capital allowance deduction against profits of 130% of the actual cost incurred.
  
  
• The 100% Business Rates holiday will continue until the end of June 2021. Thereafter, rates will be discounted by up to two-thirds until the end of March 2022.
  
  
• The 5% reduced rate of VAT for hospitality and tourism businesses will continue until 30 September 2021, before an interim rate of 12.5% is introduced until April 2022. The threshold of £85,000 at which businesses need to register for VAT will remain frozen for the next two years.
  
  
• The Chancellor has announced the creation of eight Freeports in the UK, which will be located in: East Midlands Airport, Felixstowe and Harwich, Humber, Liverpool City Region, Plymouth and South Devon, Freeports are designated areas with favourable tariffs, beneficial import and export rules, and offering potentially attractive investment opportunities.
  
  
• With a focus on green investment and scientific innovation, Sunak says the government is launching a world-leading sovereign green bond. According to the Treasury the move allows people to help drive Britain's greener future and goals to reach net zero carbon emissions by 2050.

While the extension of the furlough scheme and self-employment support scheme is predicted to protect 90% of the 2 to 3 million jobs at risk by May, the Budget was criticised as woefully inadequate in other areas. Notably in its lack of support for the millions who are struggling to stay afloat on universal credit who will only gain an uplift until next winter.

While the Chancellor claimed to be “Protecting the jobs and livelihoods of the British people” it remains to be seen if the Budget delivers in the detail. More on this later in the month. 

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