The government has ordered that a range of businesses including pubs, clubs and restaurants close from tonight and unveiled a VAT deferral scheme as part of a support package for businesses hit by the coronavirus pandemic.
Leisure centres, gyms and theatres were also ordered to shut for an indefinite period by Boris Johnson in a bid to stem the spread of coronavirus.
The government has said that retail shops were not included under the raft of mandated closures.
To support businesses impacted by the shutdown, the government has also deferred the next quarter’s VAT payments, meaning no businesses will pay any VAT from now until the end of June, representing a £30bn cash injection equivalent to 1.5% of GDP. Businesses will have until the end of the financial year to repay deferred VAT.
Other measures to support businesses hit by closures and subsequent declines in footfall include the Coronavirus Job Retention Scheme, which will allow employers of any size to apply for a grant from HMRC to cover up to 80% of wages for furloughed workers in a bid to reduce redundancies.
The government will cover wages for workers of businesses affected by mandated closures from the period covering March 1 for at least three months, with no limit imposed on the level of funding made available at a later date.
Companies will also be able to borrow up to £5m through the Coronavirus Business Interruption Scheme, up from £1.2m. The loans will now be interest-free for the first year, up from six months.
Chancellor Rishi Sunak said: “We will do whatever it takes to protect our people and businesses from the effects of this global economic emergency brought on by the coronavirus pandemic.
“The interventions I am setting out today will help support businesses of all sizes – so they can continue operating during these unprecedented times.”
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