so was that it? Is this the radical economic shift???
Yeah - not sure that'll make a great deal of difference aside from some restaurant's (probably small anyway) VAT bill.
I think this is aimed at the hospitality industry they employ a lot of people this will protect some jobs at least for now. Great news.
If accommodation, restaurants/cafes and visitor attractions are all cheaper, it may encourage folk to holiday in the UK.
So using the £10 voucher thing can I go to my local fancy cafe that also sells lots of Deli type things and get £20 of posh pasta, cheese and chutney for £10 so long as I also buy a sandwich?
So no help for the hundreds of thousands of self employed people who have had nothing so far, yet cheap loft insulation and a discounted lunch?
That's my take on it anyway...
nothing to help the majority of people then.
The same self employed people who earn £12000 a year and happily work cash in hand in the good times?
Doesn't match up to johnson's big build-up last week so no surprise there.
As for vat reduction, if it isn't passed on in full to the public it won't do much; also provides an opportunity (for less scrupulous businesses) to profit as few customers will remember what the pre-CV19 prices were.
We're still waiting for any sight of an industrial strategy.
Peekay - that would be my take on it; do you even need to buy a sandwich as the deli goodies could be described as a take-away?
- half price meals is sit down/eat in only (suspect this will be gamed though). Is the vat reduction on hot food applicable here as well?
- accommodation and vat- fine for hotel chains, whose pricing strategy isn't exactly transparent (we'll never really know whether prices have dropped) , but no help to users of the majority of holiday lets, b and b's that won't be vat registered.
- I doubt that there are hundreds of thousands of self employed who have received nothing.
Pretty sure that in 2008 the VAT reduction was never really passed onto consumers. Will be interesting to see if it is this time. We have a holiday cottage booked in October which we booked pre-COVID. Presumably the price of this should go down 15% as it is £x + VAT?
Well that is under whelming and won't work. Can't see many restaurants actively passing the VAT savings onto customers so it'll do little to stimulate demand which is what most businesses need. Small reduction in VAT they have to pay at the end of the year won't help much now either. 50% off sounds great until you realise it's capped at £10, great for the Maccy D end of the market, pretty useless for the mid price independents who are more likely to go to the wall than big low price chains.
So much for the £ 500 per head.
Also whilst I appreciate hospitality is on it's knees I'm not sure now is the time to be encouraging everyone to rush out and socialise. As for the grand per employee if you still have them at the end of 3 months, can't see that swaying many employers who are thinking of making people redundant, the cost of keeping people on for another 3 months will out weigh the grand Sunak is offering.
So no help for the hundreds of thousands of self employed people who have had nothing so far
dougie - £12k pa is within the 0% personal allowance so not taxable.
There is nothing illegal in self-employed being paid cash-in-hand; you're confusing that with not declaring earnings paid in cash.
Pretty sure that in 2008 the VAT reduction was never really passed onto consumers. Will be interesting to see if it is this time. We have a holiday cottage booked in October which we booked pre-COVID. Presumably the price of this should go down 15% as it is £x + VAT?
12.5%
The £500 was only ever a suggestion floated by a think-tank so...wishful thinking.
Can’t see many restaurants actively passing the VAT savings onto customers
Of course they won't and neither should they, I see the VAT saving as something to boost their profits and help them survive.
The food vouchers are to push people towards restaurants not the VAT saving.
. 50% off sounds great until you realise it’s capped at £10
Per person, on food. So it's a 50% reduction on a £20 a head food bill. That's a main and possible starter /desert in most of those mid priced restaurants and pubs you're talking about.
It's a 20% reduction on a 50 a head food bill, which if they're handing over the vat savings too amounts to roughly a third off a pre announcement £50 per head.
The same self employed people who happily work cash in hand in the good times?
I realise you probably were in a rush to type that one so maybe you didn’t think very hard about it...
There are a few groups of self employed folk having a hard time at the moment. You have a lot of self-employed who work on short/medium term PAYE contracts. Often in the creative sector. They pay tax. However when their clients stopped using them back in March, that was it. There’s been nothing for them.
There are freelancers, many of whom have been “forced” to work as a limited company by their clients. There’s been bugger all for them either. Largely these are small operators - not consultants charging thousands a day, offshoring their accounts or deferring taxes with dodgy schemes. I know two of them quite well. They’re absolutely strapped.
There’s not a massive amount of cash floating around in these sectors.
Self-employed sole traders have been helped by giving them 80% of 3 months salary averaged out over 3 years of earnings (up to a maximum of £2,500 per month.) Mind you, plenty of cash won’t have been declared so they’ll have taken a hit that way. And deservedly so.
dougie – £12k pa is within the 0% personal allowance so not taxable.
There is nothing illegal in self-employed being paid cash-in-hand; you’re confusing that with not declaring earnings paid in cash.
That was what I was inferring
Self-employed sole traders have been helped by giving them 80% of 3 months salary averaged out over 3 years of earnings (up to a maximum of £2,500 per month.) Mind you, plenty of cash won’t have been declared so they’ll have taken a hit that way. And deservedly so.
This
Utterly nonsense policymaking. I'd love to see the modelling for this.
Whitehall does Groupon.
The £500 was only ever a suggestion floated by a think-tank so…wishful thinking.
To be fair, the entire pandemic response, the lockdown, the easing of it has all been "floated by thinktank" first. None of it has been Government leading and instructing, it's all been leaks and "advance notice" and a testing of the waters before deciding that's what we'll do.
And then it's twisted around a little bit every time an MP or unelected adviser breaks the rules.
I don't agree that the VAT reduction shouldn't be passed on.
Sunak's hospitality support is intended to drive footfall as that's what the sector needs.
It's all about encouraging the public to spend - if that doesn't happen, the sector will be even more badly stuffed.
Yep franks right, it is supposed to increase footfall, keeping the VAT reduction isn't going to help, anyway as expected too little, tinkering around the edges whilst great chunks of the economy stare down the barrel of Covid 19 sitting on the grenade of Brexit.
#eat-out-to-help-out budget had some good ideas but not sure 10 quid off a 20 quid meal Monday to wednesday is going to save the economy
I mean, I love Nandos as much as the next guy, buy really?
Restaurants & pubs still most likely places to catch covid
Vat cut for hospitality sector sounds better but it's not price that is keeping people away now
£1000 quid to keep furloughed staff is good but if workers aren't furloughed they could be sacked instead & rehire the furloughed staff getting business gets a £1k bonus
Apprenticeship scheme long overdue should be permanent and monitored to make sure they are getting genuine training & proper jobs
Stamp duty benefits those buying the expensive properties the most, & 2nd homes not excluded & landlords not excluded, not sure will help 1st time buyers as much as housing market in general
This
What about all the other self-employed people who haven’t been helped at all? Or were you just not referring to them?
It really does very little for first time buyers
Deadly, I'll admit that I had the "arrive at the trails in the work van crowd" in my mind
What about all the other self-employed people who haven’t been helped at all?
Although not likely to give them anything close to what they were accustomed to, that's where Universal Credit kicks as the catch-all in to ensure everyone has a basic level of household income.
Of course they won’t and neither should they, I see the VAT saving as something to boost their profits and help them survive.
The food vouchers are to push people towards restaurants not the VAT saving.
+1 The cost of my haircut went up today and I was happy to pay it.
Is it though that these costs relief thingy's are actually for pushing the middle income, still in a job type people toward the restaurants and house purchases aka those that can likely still afford it? Its not really a fix for the people DD refer to, but to make sure those with some cash actually go and spend it.
The same self employed people who happily work cash in hand in the good times?
How about back in the real world and not the one that exists in your head?
I’m self-employed. I pay my tax and national insurance PAYE the same as an employee. I haven’t received a *ing penny of government money despite all my ongoing contracts being shelved in mid-March and no sign of any work. None of us have. In my industry (graphic design) this working model is the norm. There are 3 million of us. All just told to * off and left to fend for ourselves.
But am I bitter that I’m being punished for being honest and playing it straight on tax? You bet your *ing arse I am. I’m absolutely *ing livid!!!
I doubt that there are hundreds of thousands of self employed who have received nothing.
You’re right. There are 3 million of us
Still.... it’s good to see that billions of mine and everybody else’s taxes are going to be used to artificially inflate property prices in London and the South East and help rich people buy second homes in Cornwall
There are freelancers, many of whom have been “forced” to work as a limited company by their clients. There’s been bugger all for them either.
My brother contracts as a one man limited company. He has furloughed himself so is getting something. Though it is based on the £12k he paid himself as salary and not the several times larger amount he took as dividends for tax reasons.
Still…. it’s good to see that billions of mine and everybody else’s taxes are going to be used to artificially inflate property prices in London and the South East and help rich people from London buy second homes in Cornwall
Its not specific to London and the South East, think of the Cheshire Footballers won't you...
I’m self-employed. I pay my tax and national insurance PAYE the same as an employee. I haven’t received a *ing penny of government money despite all my ongoing contracts being shelved in mid-March and no sign of any work. None of us have. In my industry (graphic design) this working model is the norm. There are 3 million of us. All just told to * off and left to fend for ourselves.
But am I bitter that I’m being punished for being honest and playing it straight on tax? You bet your *ing arse I am. I’m absolutely *ing livid!!!
I might regret this, but why did you not claim Universal Credit if you had no income?
Its not specific to London and the South East, think of the Cheshire Footballers won’t you…
I’m sure the estate agents of Alderley Edge and Hale Barns will be ecstatic!
Sorry my idea of self employed is someone who submits a self assessment at the end of the tax year. Not someone who pays through PAYE.
Daft question then, do retailers not have to pass the VAT savings/ increases onto customers? Or are they simply expected to but there's no legal requirement?
Just GIVE THE MONEY TO RESTAURANTS AND CAFES!
Bribing people to go out, when they’re not convinced you have the virus under control, seems odd. What happens if eating out is later identified as transmission problem?
Also, reduce a sales tax, when there are few or no sales, is laughing in the faces of those companies hid hardest because of their venue size and location, in my opinion. Local lock down? No sales. Venue too small for social distancing? No sales. So no benefit from a VAT cut.
Both measures are aimed at large chains.
Sorry my idea of self employed is someone who submits a self assessment at the end of the tax year. Not someone who pays through PAYE.
In that case, your idea of who is self-employed is wrong. Are you Rishi Sunak, by any chance?
Because according to him, as a PAYE freelancer I am neither self-employed or an employee. I am schrodinger's employee, along with 3 million others. Apparently we don’t exist
I might regret this, but why did you not claim Universal Credit if you had no income?
If you have more than £15k in savings you aren't eligible, plus £73/week or whatever it is, is next to nothing compared with the median wage.
I am schrodinger’s employee, along with 3 million others. Apparently we don’t exist
Yep, both my brothers have fallen into this trap, no work and no help from HMG.
Just GIVE THE MONEY TO RESTAURANTS AND CAFES!
The point is to get you to spend more money that the Government will provide whilst you are there.
I might regret this, but why did you not claim Universal Credit if you had no income?
Have you seen the small print for universal credit? If your partner earns a half-decent salary, ie: much more than minimum wage, then you’re entitled to nothing. Many, many, many other terms and conditions apply.
I have been self employed, but paid through PAYE, many times in the past. I’ve always had to complete a self assessment though… if you don’t you’ll get a “you are not registered as self employed” computer says no fail when having to deal with HRMC as regards self employed earnings.
Not gonna read all the replies but what do people think the government should do? They have just paid people for three months when they could have just gone like Brazil/Sweden. We need a universal salary, but we are not going to pioneer that.
The point is to get you to spend more money that the Government will provide whilst you are there.
Well, that screws those that can’t currently open properly, doesn’t it. As I said, good for large chain venues. Easy to see it working at Nandos, less well at 6 cover family restaurants and cafes with no outdoor space.