Highlights of Budget 2021

Budget contents have been unveiled by Chancellor Rishi Sunak in the House of Commons and new measures have been announced to help businesses and support jobs through the pandemic. 

Along with this, a series of tax-raising plans to help rebalance the public finances and formulate UK’s long term economic recovery have also been laid out.

Below are some highlights of the budget 2021 for different sectors: 

 

Arts and sports 

  1. Around £400m to help arts venues including museums and galleries re-open in England 
  2. A recovery package of £300m for professional sports and £25m for grassroots football 
  3. £1.2m to help stage the delayed Women’s Euros football tournament in England in 2022

 

Alcohol, tobacco, and fuel 

  1. Duties on alcohol to be frozen for the second year too 
  2. No extra tax to be imposed on beer, cider, spirits, or wine 
  3. No further rise on tobacco duties in this budget 
  4. Freeze on the fuel duty for the eleventh consecutive year 

 

Business, digital and science 

  1. Firms to be given tax breaks to allow £20bn worth of business investment 
  2. Firms to be able to deduct investment costs from tax bills – reducing taxable profits by 130% 
  3. Apprentice incentives for the firms to rise to £3,000 and £126m for traineeships  
  4. Hospitality firms to be subjected to a lower VAT rate which is to be maintained at 5% until September 
  5. Thereafter, an interim rate of 12.5% to be applied for the following six months 
  6. Business rates holidays to continue for firms in England until June with 75% discount afterwards 
  7. Restart grants worth £5bn for shops and other businesses forced to close in England 
  8. £18,000 for gyms, personal care providers and other hospitality and leisure businesses and £6,000 per premises for non-essential outlets due to re-open in April  
  9. New visa scheme to help start-ups and fast-growing tech firms source talent from overseas 
  10. Contactless payment limit to rise to £100 later in the year 

 

Coronavirus support 

  1. Extension in Furlough until the end of September 
  2. Government to continue to pay 80% of employees’ wages for hours not worked 
  3. Employers to contribute 10% in July and 20% in August and September 
  4. Self-employed support to be extended until September 
  5. 600,000 more people to be eligible for help 
  6. Weekly uplift of £20 in Universal Credit worth £1,000 a year to be extended for another six months 
  7. A one-off payment of £500 to be made to Working Tax Credit claimants 
  8. Minimum wage to increase to £8.91 an hour from April
     

Environment, transport, infrastructure, and housing 

  1. Leeds to have a new UK Infrastructure Bank  
  2. The bank to have £12bn in capital – with the aim of funding £40bn worth of public and private projects 
  3. £15bn in green bonds (including for retail investors) to help finance the transition to net zero by 2050  

 

Health and education 

  1. £1.65bn to support the UK’s vaccination rollout and £50m to boost UK’s vaccine testing capability  
  2. £19m for domestic violence programmes and funding network of respite rooms for homeless women 
  3. £40m of new funding for victims of 1960s Thalidomide scandal and lifetime support guarantee  
  4. £10m to support the mental health needs of armed forces veterans 

 

Nations and regions 

  1. Funding of £1.2bn for the Scottish government, £740m for the Welsh government and £410m for the Northern Ireland executive 
  2. 750 UK civil servants to be relocated to new Treasury campus in Darlington 
  3. £1bn fund to promote regeneration in a further 45 English towns, including Middlesbrough, Preston, Swindon, Bournemouth, Newark, West Bromwich, and Ipswich 
  4. £150m for community groups to take over pubs at the risk of closure 
  5. First eight sites for freeports in England announced. These include, East Midlands Property, Felixstowe and Harwich, Humber, Liverpool City Region, Plymouth, Solent, Thames, and Teesside 

  

State of the economy and public finances 

  1. UK economy shrank by 10% in 2020 
  2. The economy expected to rebound in 2021 with a predicted annual growth of 4% this year 
  3. The economy expected to return to pre-Covid levels by middle of 2022 with a growth of 7.3% next year  
  4. 700,000 people lost their jobs since the pandemic began  
  5. Unemployment expected to peak at 6.5% next year – lower than 11.9% predicted previously 
  6. UK to borrow a peacetime record of £355bn this year 
  7. Borrowing for the 2021-2022 to total £234bn   

 

Taxation 

  1. Rates of income tax, national insurance, and VAT to stay the same  
  2. Tax-free personal allowance to be frozen at £12,570 from April 2021 levels to 2026 
  3. Higher rate income tax threshold to be frozen at £50,270 from April 2021 levels to 2026  
  4. Corporation tax on company profits above £250,000 to rise from 19% to 25% in April 2023 
  5. 1.5m smaller companies with profits of less than £50,000 to be subjected to a rate of 19% 
  6. Extension on stamp duty holiday to 30 June for house purchases in England and Northern Ireland  
  7. No tax to be charged on sales of less than £500,000 
  8. Freeze in inheritance tax thresholds, pensions lifetime allowances and annual capital gains tax exemptions to 202-2021 levels until 2025-26 

 

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