London — Chancellor Rishi Sunak has already announced a £330bn package of support for businesses, equivalent to 15 per cent of GDP.
This comes on top of previously announced £30bn package of support for businesses to help them cope.
Many firms are warning of collapse, wiping out thousands of jobs, as life in the UK is largely put on hold.
Prime Minister Boris Johnson signalled Chancellor Rishi Sunak would be saying more on Friday about the extended package the government is putting forward for workers.
The PM has urged struggling businesses to “stick by their employees, because we’re all going to need them”.
The chancellor is set to announce an employment and wage subsidy package to try to protect millions of jobs today, BBC reported.
One proposal under discussion is for the UK to follow the lead of countries such as Denmark, where the government has promised to cover 75% of salaries at private companies for three months, if they promise not to let staff go, various media sources say.
The simple guidelines of previously announced business relief package are as follows :
- The government will extend the Coronavirus Business Interruption Loan scheme from up to £1.2m per business to £5m with no interest payable for six months. This new loan scheme will be up-and-running by the end of next week. “Any business that needs access to cash will be able to get a government-backed credit on attractive terms,” said Sunak.
- Government will increase £3,000 cash grant announced in the Budget to up to £10,000 per business. This scheme will be administered by local authorities and the business department will be talking to local authorities this week about how the scheme will work. This is a £20bn package for local authorities. Sunak advised any small businesses in distress to speak directly to their local authorities.
- Businesses in retail, hospitality and leisure with a rateable value of between £15,000 to £51,000 will be able to access a bigger grant of £25,000.
- All retail, leisure and hospitality companies will be exempt from business rates for a whole year.
- Treasury will work with business groups to develop an Employment Support Package that will help to mitigate employment costs for small firms, thereby preventing lay-offs.
- The Treasury will stand behind those businesses that do have business interruption insurance policies that do include pandemics but will have excluded COVID-19 because it is such a new virus. However, most small businesses will still not be insured through business interruption policies because most just apply to fire and flood.
- HMRC will extend “time to pay” arrangements for companies affected by acts of God such as flooding to coronavirus. These arrangements are negotiated on an individual basis between SMEs and Treasury, which means debt collection is suspended if they cannot afford to pay their tax bill. And HMRC said that during the coronavirus pandemic, the usual 3.5 per cent annual interest on deferred tax payments will be scrapped.