Businesses will have to start paying part of the cost of the explosion from tomorrow – even though most of them remain closed or operate with limited powers under lock rules.
Treasury has been paying 80% of the salaries of temporary employees who have been temporarily retrenched due to COVID-19 for more than a year but funding will begin on July 1.
The time to pay for the holidays in terms of entertainment businesses, hospitality and retail businesses is also beginning to be withdrawn.
Another COVID-19 rate that ends with a stamp holiday, which is returned in limited form from the beginning of July and ends completely in September.
Government support measures are designed to keep the economy afloat in health care at a time when many firms are being forced to close.
They are starting to withdraw now as the locking mechanisms are simpler.
But there are fears of the future in those sectors that are still closed or facing severe restrictions, among them airplanes and hospitality – especially nightclubs.
And the Institute for Fiscal Studies, a respected think tank, has warned of a possible backlash for some employees who end up losing their jobs when it is over.
How are the key mechanisms of government support changing from 1 July?
The Coronavirus job creation program, which began in March 2020, has been praised for saving the UK from the massive unemployment outbreak that was feared at the beginning of the epidemic.
It has so far been used to support 11.5 million workers, as well as 1.3 million employers, and has cost £ 64bn in mid-May, according to the latest HM Revenue and Customs (HMRC) data.
At its peak in May 2020 the population at furlough stands at 8.9 million. This dropped to 3.4 million at the end of April this year, according to HMRC figures.
The latest figures from the National Bureau of Statistics (ONS) suggest that the total has dropped to 1.5 million in early June.
The subsidy scheme has been paying 80% of workers’ unpaid hours due to the epidemic, up to £ 2,500 a month.
From tomorrow this will be reduced to 70%, with employers having to contribute 10%.
This goes back to 60% and 20% from August and the program is completely completed after the end of September.
The scheme, designed to provide the same level of self-help to 2.8 million people, cost £ 24.5bn in mid-May.
The final grant under the scheme, which includes trading until the end of September, can be claimed from the end of July.
BUSINESS It balances freedom
About 400,000 firms in the well-known hospitality, shopping and entertainment sectors have achieved 100% discount on business rates since April last year.
The 15-month holidays end today in their current state, with a 66% discount applicable from 1 July to a maximum of £ 2m. The program will end next April.
Altus Group housing consultants estimate that the plan will eventually cost £ 17.1bn.
WORK HOLIDAY STORE
In July, the postage stamp limit was temporarily increased from £ 125,000 to £ 500,000 – a holiday that has been extended but ends the way it is today.
The stamp duty is reduced to £ 250,000 from July 1 to £ 125,000 from October.
The measure was introduced to revitalize the housing market after the death of transactions in the early stages of the epidemic.
Work has been on the rise ever since and recent figures from Nationalwide have shown that house prices have risen sharply since 2004.
Reduced evictions during the epidemic have become a way of life for some firms who cannot afford to pay their rent.
That has been extended to 2022 though not without complaints from homeowners who say some of the big business owners who are able to pay are using the system.
The government this month has been under pressure from businesses to increase the support available to firms, especially when the COVID-19 deadline from June 21 to July 19 ends and the resumption of travel has been much slower than many had hoped.
Business groups have warned that without additional assistance such as continued support or reduction of business standards in certain sectors, thousands of jobs could be at risk in areas such as airports and airports.
However, Treasury has been emphasizing the need to repair the UK’s badly damaged public funds in the medium term, after a crisis thought to be worth more than £ 400bn, and has seen annual loans hit the post-war record, with debt rising to more than £ 2trn.
IFS said: “The rest of the furlough scheme is a step towards ‘normal’ in the labor market, but it will also mean huge financial losses for many of those who end up unemployed without being able to quickly find another job.”
Tom Waters, a major economist in think tank research, said: “The furlough system needs to be hurt as the economy recovers, rather than trying to keep all jobs backed by health.
“But this means that some will eventually lose their jobs and turn to other programs – especially celebrities.
“While some will be relatively safe, some will find that the transition from furlough to general debt will mean a significant reduction in wages.”