Budget: At-a-glance guide to the main points

Chancellor Rishi Sunak has delivered his 2021 spring Budget to the House of Commons. Here are the main points:

Public finances

  • UK economy shrank by 10% in 2020
  • Economy forecast to rebound in 2021, with projected annual growth of 4% this year
  • Economy forecast to return to pre-COVID levels by middle of 2022, with growth of 7.3% next year
  • 700,000 people have lost their jobs since pandemic began
  • Unemployment expected to peak at 6.5% next year, lower than 11.9% previously predicted
  • UK to borrow a peacetime record of £355bn this year.
  • Borrowing to total £234bn in 2021-22

COVID-19 support

  • Furlough to be extended until the end of September
  • Government to continue paying 80% of employees’ wages for hours they cannot work
  • Employers to be asked to contribute 10% in July and 20% in August and September
  • Support for the self-employed also to be extended until September
  • 600,000 more self-employed people will be eligible for help as access to grants is widened
  • £20 uplift in Universal Credit worth £1,000 a year to be extended for another six months
  • Working Tax Credit claimants will get £500 one-off payment
  • Minimum wage to increase to £8.91 an hour from April

Business, digital and science

  • Tax breaks for firms to “unlock” £20bn worth of business investment
  • Firms will be able “deduct” investment costs from tax bills, reducing taxable profits by 130%
  • Incentive grants for apprenticeships to rise to £3,000 and £126m for traineeships
  • VAT rate for hospitality firms to be maintained at reduced 5% rate until September
  • Interim 12.5% rate to apply for the following six months
  • Business rates holiday for firms in England to continue until June with 75% discount after that
  • £5bn in Restart grants for shops and other businesses forced to close
  • £6,000 per premises for non-essential outlets due to re-open in April and £18,000 for gyms, personal care providers and other hospitality and leisure businesses
  • New visa scheme to help start-ups and rapidly growing tech firms source talent from overseas
  • Contactless payment limit will rise to £100 later this year

Environment, transport, infrastructure and housing

  • New UK Infrastructure Bank to be set up in Leeds
  • It will have £12bn in capital, with aim of funding £40bn worth of public and private projects
  • £15bn in green bonds, including for retail investors, to help finance the transition to net zero by 2050

Nations and regions

  • £1.2bn in funding for the Scottish government, £740m for the Welsh government and £410m for the Northern Ireland executive
  • 750 UK civil servants to be relocated to new Treasury campus in Darlington
  • £1bn Towns Fund fund to promote regeneration in 45 English towns
  • £150m for community groups to take over pubs at risk of closure
  • First eight sites for freeports in England announced

Tax

  • No changes to rates of income tax, national insurance or VAT
  • Personal income tax allowance to be frozen at £12,570 from April 2022 to 2026
  • Higher rate income tax threshold to be frozen at £50,270 from 2022 to 2026
  • Corporation tax on company profits to rise from 19% to 25% in April 2023
  • Rate to be kept at 19% for about 1.5m smaller companies with profits of less than £50,000
  • Stamp duty holiday on house purchases in England and Northern Ireland extended to June, with no tax liability on sales of less than £500,000
  • No changes to inheritance tax or lifetime pension allowance or capital gains tax allowances

Health and education

  • £1.65bn to support the UK’s vaccination rollout
  • £19m for domestic violence programmes, funding network of respite rooms for homeless women
  • £40m of new funding for victims of 1960s Thalidomide scandal and lifetime support guarantee
  • £10m to support armed forces veterans with mental health needs

The arts and sport

  • £400m to help arts venues in England, including museums and galleries, re-open
  • £300m recovery package for professional sport and £25m for grassroots football

Alcohol, tobacco and fuel

  • All alcohol duties to be frozen for second year running
  • No extra duties on spirits, wine, cider or beer
  • Fuel duty to be frozen for eleventh consecutive year
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