The gloves are off – Chancellor announces new measures to challenge economic effect of coronavirus

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Hot on the heels of the Prime Minister’s statement yesterday and less than a week after his own Budget, Rishi Sunak wasted no time tackling head on the economic problems facing businesses and individuals brought about by the coronavirus.

In addition to last week’s measures the Chancellor announced a further initial increase of £330 billion in loans and guarantees to support firms throughout the period including:

• Extra financial support for larger firms
• An increase in the amount that businesses can borrow through the Coronavirus Business Interruption scheme from £1.2M to £5M. in addition the Government will cover the interest for the first 6 months, making this a 6 month interest free loan for businesses
• Including in the Covid Bill new powers to enable further financial support to be made as necessary

The retail, hospitality and leisure industries will be hit particularly hard and in moves aimed mainly at those industries further business rates support has been offered by:

• Exempting all retail, hospitality and leisure businesses from rates for the next 12 months
• Increasing the recently announced small business eligible Small Business Rate Relief cash grants from £3,000 to £10,000
• Providing further £25,000 grants to retail, hospitality and leisure businesses operating from smaller premises with a rateable value between £15,000 and £51,000

In addition, the Government have said that they believe that their advice to the public to avoid pubs, clubs, theatres etc will be sufficient for these businesses to claim on their insurance where they have appropriate pandemic cover.

To support food businesses the Government will relax planning regulations so that pubs and restaurants can provide takeaways without a planning application.

In a welcome move to settle individuals worried about meeting their mortgage commitments, mortgage lenders have agreed that they will support customers experiencing financial issues as a result of coronavirus with mortgage payment holidays of up to 3 months.

The Chancellor was keen to point out that the Government would do whatever it took to protect people and business from the economic effects of the global pandemic.