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Rishi Sunak’s key announcements in today’s Budget statement

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  • Huge tax hike announced – with corporation tax on company profits rising by 6% to 25% in 2023
  • Furlough extended until September
  • Income tax threshold freeze likely to mean working Britons pay more – with tax burden from 2025 highest since 1960s
  • Universal Credit uplift of £20 extended for six months
  • Budget to feature plan to extend furlough until September
  • Business rates, VAT and stamp duty reductions extended
  • Contactless limit more than doubles
  • Sunak to give news conference at 5pm – the first of its kind for a budget
  • Federation of Small Businesses said they were disappointed that there was not enough in the budget for “job creation”.

 

A HUGE hike in corporation tax is probably the main headline announcement of the budget.

The chancellor said: “This new higher rate won’t take effect until April 2023, well after the point when the OBR expect the economy to have recovered. And even this, because corporation tax is only charged on profits, any struggling businesses will, by definition, be unaffected.

“I’m protecting small businesses with profits of £50,000 or less, by creating a Small Profits Rate, maintained at the current rate of 19%.”

“This means around 70% of companies – 1.4 million businesses – will be completely unaffected.

“And third, we will introduce a taper above £50,000, so that only businesses with profits of £50,000 or greater will be taxed at the full rate of 25″%.”

The Chancellor also said businesses can carry back losses of up to £2m for three years and adds that the bank surcharge will be reviewed so combined rate of tax on UK banking sector doesn’t increase significantly from current level.

This announcement was on top of a raft of other measures, including the previously leaked extension of the furlough scheme, and confirmation that
the Hospitality and tourism will continue to enjoy a 5% reduced rate of VAT for a further six months.

Support for the self-employed will also be extended until the end of September.

“When the scheme was launched, the newly self-employed couldn’t qualify because they hadn’t all filed a 2019-20 tax return,” Rishi Sunak says.

“But as the tax return deadline has now passed, I can announce today that, provided they filed a tax return by midnight last night, over 600,000 more people, many of whom only became self-employed last year can now claim the fourth and fifth grants.”

Commenting on the Budget statement, Welsh Conservative Senedd leader, Andrew RT Davies MS said: “At the start of this pandemic, as Conservatives we said we would do whatever it takes to protect jobs and livelihoods – and today’s budget continues that commitment to families, workers and businesses across Wales.

“After the most difficult year in the history of peacetime Britain, the budget extends the support for Wales to save jobs, invests in industry and business, and provides an extra £740 million of funding to the Welsh Government.

“Labour ministers in Cardiff Bay must now use this additional funding to extend the business support for firms across Wales and deliver a council tax freeze to help keep more money in the pockets of hardworking people.

“Our recovery and future economy depends on remaining as one United Kingdom. Only the Welsh Conservatives – working with, rather than against a Conservative UK Government – can succeed in getting things done to rebuild Wales.”

ADDITIONAL  MEASURES

Rishi Sunak confirmed that 95% mortgages will be guaranteed by the government as part of government plans to turn “generation rent into generation buy”.
“I’m pleased to say that several of the country’s largest lenders including Lloyds, NatWest, Santander, Barclays and HSBC will be offering these 95% mortgages from next month, and I know more, including Virgin Money will follow shortly after,” the chancellor says.
“A policy that gives people who can’t afford a big deposit the chance to buy their own home.”

Working Tax Credit claimants will also be given more support for the next six months, with a one-off payment of £500, it has been announced.

A welcome announcement for many families in Wales will be the confirmation that the Universal Credit uplift of £20-a-week will continue for another six months, the chancellor announces

The Chancellor also added that the personal tax thresholds will be frozen.

Hospitality and tourism will continue to enjoy a 5% reduced rate of VAT for a further six months

STAMP DUTY

As part of the spring budget, the Chancellor has just announced that the stamp duty holiday is to be extended, offering a total tax saving on properties costing up to £500,000 and a reduction on homes costing more than that. In addition first-time buyers will have access to government guaranteed mortgages with a deposit of just 5%. Home Insurance Expert at Confused.com Jessica Willock says:
“The new government backed mortgage scheme should give first-time buyers the chance to save on rent payments and take steps onto the property ladder.
“Our research found that more than a quarter (27%) of people said that if they knew of ways to save money when it comes to their homes, they would use them. So, the stamp duty holiday extension can also be seen as an opportunity to give buyers the boost that they need by removing some of the financial pressure attached to a new home.

“But the extension is only temporary, lasting until June 30th. So, whether you’re already in the purchase process or you’re deliberating a move, it’s important to get the ball rolling as the deal must complete by the deadline, otherwise you could face some big bills. If you’re confused about what you may have to pay, use our Stamp Duty Calculator to help you factor in the fees.”
Commenting on the furlough extension, Aude Barral, co-founder of developer recruitment platform CodinGame, said: “There will be a collective sigh of relief from families across the country that the furlough scheme has been extended.

“Millions of people will have been facing the prospect of having little or no income from May, and for the time being that cliff-edge scenario has been avoided. But the problem hasn’t gone away, it’s simply been kicked down the road.

“Furlough is protects salaries, not jobs. Many furloughed workers will still be worried they won’t have a job to go back to when the financial support eventually ends.

“There will be thousands of businesses going to the wall over the coming months and sectors such as hospitality and retail may never fully recover.

“The Government has provided its roadmap out of lockdown, but it’s roadmap out of furlough feels disjointed and a little vague.

“Millions of people are facing unemployment without the transferable skills they need to find a new career.

“There wasn’t enough in the Chancellor’s speech to address the digital skills gap, for my liking. Digital upskilling should be at the forefront of the Government’s plans to unlock the country’s full potential, as that’s where demand is going to be post-pandemic, in a fast changing digital landscape.

“Businesses need to be continually updating their workers’ digital skills to remain competitive, and individuals need the help and support to identify the transferable skills they have and develop new skills to stand the best chance of finding a new job or career.

“We live in a world where new technologies play an increasingly important role in all aspects of business, and demand for digitally skilled employees is only going in one direction.”

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Business

Johnston holiday lodges expected to be approved

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PLANS for 20 self-catering holiday lodges in the Pembrokeshire village of Johnston are expected to get the go-ahead next week.

An application before the May 21 meeting of Pembrokeshire County Council’s planning committee by Peter Rawsthorne seeks permission for the short-stay lodges and associated works on land behind The Larder, Vine Road.

The application, sited near a collection of single storey buildings associated with Silverdale lodge which are currently in use as temporary emergency accommodation, is recommended for delegated conditional approval.

A report for planners says: “The application seeks full planning permission for the siting of 20 short-term stay holiday lodges.  The lodges would be positioned on concrete bases either side of a central access road running through the length of the site.

“Comprising of either two or three bedrooms, each unit would have the benefit of an associated car parking space and raised veranda to provide access into the unit and an external amenity area.  The lodges will be finished with timber or timber effect cladding to the walls under a shallow dual pitched roof of metal sheeting with a UPVC framed fenestration and rainwater goods.”

It adds: “The proposal will generate some noise, odours and artificial light nuisance in comparison to a currently vacant site.

“Given the close proximity, at the southern end of the application site, to existing residential in Silverdale Close and Acorn Drive the Head of Housing and Public Protection has advised that a Noise Impact Assessment (NIA) should be required prior to the determination of the application to allow for the assessment of all noise emissions from the proposed development and for this to set out proposed measures of how to attenuate any noise nuisance.

“Consideration has been given to whether requiring such an assessment would be reasonable or necessary to make the development acceptable.

“It is acknowledged that the nature of the use of the site as proposed could generate some noise and disturbance, and that there is likely to be a heightened awareness to this for existing occupiers when the site is first occupied, compared to the current vacant use of the site or its previous use as an informal garden space for occupiers of the Silverdale lodges.

“However, the residential occupation of the space, albeit by short-term visitors who may have less regard for existing permanent residents, is a use typical of and expected in this service centre sized settlement and could be satisfactorily absorbed.

“Excessive noise and anti-social behaviour are matters which can also be dealt with by other legislative controls.”

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Business

Tafarn Sinc community pub’s call to keep disabled access granted

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A PEMBROKESHIRE community pub, which earned the support of a Hollywood star, has been allowed to keep a disabled access walkway and restored platform used for performances by local choirs.

In a retrospective application submitted to Pembrokeshire Coast National Park, Cymdeithas Tafarn Sinc sought permission to retain works at the Tafarn Sinc community pub in Rosebush.

In its submission, the community group said: “An existing platform adjacent to the pub has been restored and slightly expanded; with a new access walkway installed.

“The walkway was added for Health and Safety reasons and allows both able bodied and disabled people to safely access the platform. The platform is used for a variety of activities, such as performances by local choirs.

“The platform was formerly railway platform on a small branch line, and has been restored to look as it did when it was operational.”

The works were undertaken in 2022, the application said.

Tafarn Sinc had been in danger of closing when the old landlord and landlady retired back in 2017 but a huge fund-raising effort that attracted worldwide interest – including support from Hollywood star Rhys Ifans – meant it is now owned and run by the local community.

Campaigners raised a staggering £325,000 in little more than three months to buy the pub and keep it open and at the heart of community life.

Other public figures like Huw Edwards, Jamie Owen, Dewi Pws, Dafydd Hywel and ‘Heno’ presenter Mari Grug gave their support, with £200 shares bought by people from all over the world.

An officer report for the scheme proposed said: “The pub itself is constructed from corrugated metal and has an historical, industrial appearance. Historically, Rosebush Railway Station was adjacent and to the west of the pub building, built as part of the same development in the latter 19th century.

“A section of the Maenclochog Railway and platform still exist and form part of the pub and village’s visitor attraction. An inaccessible platform mock-up of a family of passengers had existed prior to this current development.”

Recommending approval it said: “The scale of proposal is proportionate to the existing ‘railway’ features and will create little impact on the special qualities of the National Park.

“There is concern however that the proposal could create an amenity impact for which this proposal has not been assessed for. An appropriate condition restricting the use of the development to prevent harmful noise pollution is therefore included.”

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Council set to lease Haverfordwest airport in bid for financial stability

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SENIOR Pembrokeshire councillors are next week being recommended to lease Haverfordwest airport as part of plans to make the council-run facility, which had a circa £119,000 deficit last  year, cost-neutral to the authority.

Last year, Pembrokeshire County Council’s Cabinet, members heard the financial position at the council-supported Haverfordwest/Withybush airport deteriorated in 2022/23, with an out-turn position for 2022/23 of £238,000.

In March of this year, Pembrokeshire County Council’s services overview and scrutiny committee backed a recommendation that a lease to an existing stakeholder / established aviation company was pursued, including a wider stakeholder consultation.

A report before members at that meeting said the £238,000 loss had been reduced to an expected £119,000 for 2023/24 “following an extensive review of the operations of the airport”.

The report listed reasons for the halving of this deficit, including: an increased profit margin on fuel £40,000; increased landing fees £7,000; reduction in staff training £8,000; reduction in equipment and equipment maintenance costs £10,000; and a reduction in one off costs of hedges and sewers £53,000.

Following the scrutiny meeting, a more detailed recommendation is to be presented to Cabinet on May 20, and, if approved, would be dealt with under the delegated authority of the Assistant Chief Executive, with relevant input from officers.

The report before Cabinet says, following discussions with existing stakeholders: “It seems likely that the council would be able to agree a lease of the airport to an experienced and well-established aviation company who is an existing stakeholder with a good track record.”

The lease would be for an initial 10-year term, with a requirement to obtain/keep a CAA [Civil Aviation Authority] Cat II licence and at a market rent.

It adds: “This option would make the airport cost-neutral to the council from the day the lease is signed whilst also ensuring that an operational airport remains for Pembrokeshire to benefit from.

“The council intends to exclude Hangar 5 [indoor trampolines] from any lease as it is not part of the operational area of the airport and doesn’t house an aviation-linked business. This enables the council to keep the rental income from this property.

“The council also intends to include an option to take back, at no cost, part of the airport that may have the potential to be developed as a solar farm or industrial units.  Any staff currently employed at the airport would transfer to any new tenant/operator.

“Any lease would have to allow the operator to run the airport on the commercial terms of their choosing to give a chance of long-term sustainability, so, the council will lose full control of how the airport operates.

“However, any lease will require that the airport be maintained to an acceptable standard and that a CAA Cat II licence is maintained. If these terms of the agreement are breached, then the facility will return to the council.”

The report finishes: “It should be of note that an alternative proposal has recently been put forward by another existing stakeholder who does not have aviation experience.

“The proposal is one of a land swap whereby the council would exchange the airport land for other land owned by the stakeholder concerned. If this option were to be taken, the council would relinquish all its interest and any element of control it has in the airport, and accordingly there is no guarantee that an operational airport would remain in the county.”

It is recommended the former proposal is adopted; that the airport is leased to an existing stakeholder and established aviation company.

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