Businesses are calling for an extension of the UK government’s Job Retention Scheme as well as the business rates release holiday, as firms across the country continue to struggle under the strain of COVID-19 lockdowns.
The Confederation of British Industry (CBI), a membership body speaking on behalf of 190,000 British businesses, has said that 2021 will be a “defining year” for the government’s quest to create a greener, more dynamic and competitive UK. It argued that the time is now for a comprehensive reform of the business rates system.
It said “ensuring firms’ survival until the economy reopens fully will be key to turning this ambition into reality.”
The UK government has extended multiple lifelines to businesses over the course of the last year, as COVID-19 hit sectors such as retail and hospitality particularly hard.
In a letter to chancellor Rishi Sunak, business group outlined demands for support measures needed in the next few weeks, ahead of the budget, to help protect UK companies through the Spring.
It has requested action on extending furlough, lengthening repayment periods for existing VAT deferrals until June and extending the business rates relief holiday for at least another three months.
Tony Danker, CBI director general, said: “The Budget comes at a crucial time for the UK. Almost a year of disrupted demand and extensive restrictions to company operations is taking its toll. Staff morale has taken a hit. And business resilience has hit a sobering new low.
“Many tough decisions for business owners on jobs, or even whether to carry on, will be made in the next few weeks. If the Government plans to continue its support then I urge them to take action before the Budget which is still more than six weeks away.”
Other recommendations included in the letter are to announce details of the successor of the Coronavirus Business Interruption Loan Scheme (CBILS) and ensure the Coronavirus Corporate Financing Facility (CCFF) scheme is kept open until the end of June 2021.
The CBI says that the budget also provides a chance to look beyond the immediate crisis to the reopening of the economy.
It says: “Setting the UK on a path to recovery will rely on unlocking business investment.”
It recommends using the UK’s net-zero transition to drive economic recovery, revamp the business rates system and to incentivise businesses to retrain and up-skill workers, among other things.
Rain Newton-Smith, CBI chief economist, said: “The Government should use the upcoming Budget to speed ahead to low carbon: to accelerate investment in low-carbon infrastructure - through fundamental business rates reform to promote energy efficiency - and the innovative technologies that will smooth the path to achieving net-zero by 2050.
“This Budget is an opportunity to focus on a balanced economic recovery, not driven solely by consumption and government spending, stimulating much-needed business investment and tackling the systemic challenges that have held the UK back.
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