WHAT’S NEW?
BUDGET ANNOUNCEMENT RECEIVES MIXED RESPONSE FROM RETAIL EXPERTS On 3rd
March 2021, Chancellor
Rishi Sunak announced the latest Government Budget to support businesses in their recovery from the impact of COVID-19, gaining a mixed response from the retail sector.
Initiatives include the extension of the furlough scheme until September 2021 and the business rates “holiday” being extended until the end of June.
The Chancellor also announced the introduction of ‘Restart Grants’, with £5bn allocated for shops and other businesses in England forced to close because of restrictions. Non-essential retailers will be able to claim up to £6,000 per premises.
Responding to the Chancellor’s Budget, Helen Dickinson, Chief Executive of the British Retail Consortium, praised some elements of the announcement but said that further funding is needed to prevent ‘non-essential’ retailers from struggling.
https://www.brc.org.uk/
Helen said: “The Chancellor has listened to many of our concerns and we welcome the extension of key business funding schemes. Action to support the retail industry will be vital to reviving the economy – including business rates relief, restart grants and loans, and an extension to the furlough scheme. However, for many retailers, the devil will be in the detail, with caps on funding limiting access to this support. The Chancellor must keep the situation under review, as we wait to see how the economy responds to reopening.
“The Chancellor has taken steps to avoid the business rates cliff edge on
twitter.com/TRetailFloors
1st
April, and the three-month extension
will provide essential funding at this challenging time. Beyond this point, relief is capped at only £2m for closed businesses, a tiny fraction of their total liability. Without further funding, it is likely that many ‘non-essential’ retailers will struggle under sluggish consumer demand and high Covid costs. The business rates system remains broken- it is vital that the ongoing business rates review delivers on its promise to reduce the burden on retail which already results in store closures and job losses.”
Speaking on behalf of the flooring retail sector, Rupert Anton, of The Carpet Foundation, told Tomorrow’s Retail Floors: “The Carpet Foundation broadly welcomes today’s budget. It was, understandably, a budget of two halves – one focussing on the response to the pandemic and the Government’s commitment to protecting, creating and supporting jobs, with the second focussing on the public finances and the measures needed to reduce the exceptionally high level of borrowing.
https://carpetfoundation.com/
“There were, however, several pieces of good news for the industry. The extension of the furlough job retention scheme until the end of September was a pleasant surprise as many employers are still heavily reliant upon it.
“Independent retailers should be pleased as well with the news that they will be entitled to receive grants of up to £6000 per premises. Furthermore, they can also benefit from the three-month extension to the business rates holiday, followed by a further six-month period when rates will be discounted by two thirds.
“While the headline corporation tax shows a potential increase up to 25% at the highest level, it is encouraging that it is tapered.
“Finally, the Stamp Duty holiday extension until the end of September has to be good news for the housing market, on which we are dependent.
“So, all in all, not a bad Budget for the UK carpet industry in the current climate.”
Home delivery specialist ParcelHero criticised Chancellor Rishi Sunak’s Budget announcement, stating that it isn’t enough to rescue retail.
https://www.parcelhero.com/
ParcelHero’s Head of Consumer Research, David Jinks MILT, said: “It was all-too obvious that, despite the £65bn the Chancellor claims to be spending, there was not enough cash to splash to save many businesses.
“Looking at the measures Sunak has introduced, there are undoubtedly some strong initiatives, such as the extension of the furlough scheme to September, that could save thousands of jobs. On the other hand, there will be new employer contributions to the scheme. In addition, the rapid phasing-out of full business rates relief will be grim news for many retailers.
“Offsetting business rates with a threatened new 2% tax on e-commerce sales will simply leave many retailers paying double taxes and will further endanger many of our favourite stores.
“The £5bn restart scheme for high street shops and hospitality firms in England is welcome news. However, the impact of Covid means unpaid business debt will double to more than £8.6bn this year, according to figures released today by The Insolvency Service. The new scheme won’t come anywhere near to covering the true price of the pandemic on independent retailers. The news that non-essential retailers will only qualify for grants of up to £6,000 will also disappoint many business owners.”
Tomorrow’s Retail Floors | 07
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