Updated: Jul 15
The Chancellor has slashed VAT for six months on food, accommodation and attractions from 20% to 5% and introduced a government-backed eat out discount in a bid to get help the hospitality sector bustling once again.
VAT will be reduced from Wednesday 15th July until Tuesday 12th January while a new "Eat Out to Help Out" scheme will go live next week, giving everyone that eats out at participating businesses Monday to Wednesday 50% off their meals. It will be capped at a maximum discount of £10 per head.
Businesses will need to register through a website that opens on Monday. Each week they can claim the money back with the funds being in their bank account with five working days.
The initiatives are designed to protect the 1.8 million people that work in hospitality.
Speaking in The House of Commons today, Rishi Sunak described the moment as being "unique", having never tried such a scheme in the UK before.
Also announced were a raft of measures to protect jobs, including a new Job Retention Bonus policy to reward and incentivise employers who successfully bring back furloughed employees. It will pay £1,000 bonus per employee brought back after the initial furlough scheme ends in October if they are still in employment by January.
The bonus payments will be made from February 2021. More details of the scheme will be announced by the end of July.
A new "Kick-Start Scheme", meanwhile, will pay employers to create new jobs for 16-24 years olds at risk of unemployment. Wages will be covered for six months as well as any overheads. This is the equivalent of £6,500 for a 24-year-old.
The government has also committed to paying businesses £1,000 to take on new trainees and to giving companies £2,000 each to encourage them to hire apprentices. Firms will also get £1,500 to cover apprentices over 25.
The main budget and spending review is due to follow in autumn when the Chancellor will introduce further measures to help the British economy.