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Business support starts to taper off from today after just over one month of full reopening

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The government’s financial support is to start tapering back from today, as the furlough scheme begins its wind down and the rates holiday for hospitality businesses starts to be withdrawn.

From Thursday 1 July, the Coronavirus Job Retention Scheme, which began in March 2020 and has provided a lifeline to thousands of businesses, will be scaled back, with employers having to pay towards the furlough contribution for the first time.

Staff will continue to receive 80% of their wages – up to £2,500 a month – but employers will have to pay 10% with the government stumping up the other 70%.

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This tapers back to 60% and 20% from August and the scheme ends entirely after the end of September.

At its peak in May 2020 the number of people on furlough stood at 8.9 million, according to the HMRC figures. By the start of June, this number had dropped to around 1.5m people, ONS data suggested.

The business rates holiday for leisure and hospitality businesses will also start to be wound down from today.

Companies across the hospitality sector have benefited from a 100% discount in business rates since April last year, with the relief said to have impacted almost 400,000 firms.

The 15-month rates holiday ends today in its current form, with 66% relief applying from 1 July up to a maximum discount of £2m. The scheme will come to an end next April.

The hospitality sector has been one of the hardest hit by the pandemic and have been allowed just over one month of full trading before these payments come into play. Some segments of the sector are still closed due to government restrictions, including nightclubs.

Where does this leave your business? Get in touch with Editor Zoe Monk zoe.monk@itppromedia.com to share your views.

Tags : business ratesCoronavirus Job Retention SchemefurloughGovernment
Zoe Monk

The author Zoe Monk

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