Britain’s struggling housing market could be given a much-needed shot in the arm with a six-month stamp duty holiday.
Chancellor Rishi Sunak is expected to announce plans for a temporary exemption for homes at the lower end of the market in the Budget in the autumn.
Treasury officials are looking at raising the threshold at which homebuyers start paying stamp duty.
Currently the levy is not charged on the first £125,000 of the property selling price, with a 2 per cent rate up to £250,000 and 5 per cent on the next £675,000.
The new threshold, which would be put in place for six months to stimulate demand, is likely to be set at somewhere between £300,000 and £500,000.
Chancellor Rishi Sunak could give a much-needed shot in the arm to the housing market with a six-month stamp duty holiday
During the lockdown, Britons were told not to move house. This restriction has now been lifted, but the property market has remained sluggish
First-time buyers are already exempt from paying the duty on homes under £500,000 in London and £300,000 in the rest of the country.
Labour backs ‘wealth tax’ on assets as part of a ‘new settlement’ to help the UK recover from coronavirus crisis
by JAMES TAPSFIELD for MailOnline
Labour has backed the idea of a wealth tax to help the UK recover from coronavirus meltdown.
Shadow chancellor Anneliese Dodds said a levy on assets, rather than income, should be consider as part of a ‘new settlement’ after the crisis.
Delivering her first major speech since being appointed by Keir Starmer, she insisted the move would help ensure the government does not need to increase taxes or cut support for ‘low and middle-income people’.
Ms Dodds said there was an injustice in the worst-off paying more tax proportionally than high earners, while the rich face lower charges on their capital.
She criticised Boris Johnson’s ‘muddled, confusing’ and ‘much too slow’ response to protecting the nation’s health during the Covid-19 outbreak.
The furlough scheme should be extended in a ‘targeted’ way to avoid a ‘flood of redundancy notices’, particularly for areas forced into local lockdowns such as Leicester.
But she said Labour would not back extending the job retention scheme – which has seen the Government meet 80 per cent of workers’ wages up to a ceiling of £2,500 a month – indefinitely, insisting it should be used to shore up specific sectors.
‘These support schemes should serve as economic sandbags, ensuring localised second waves of Covid-19 don’t wash away businesses and jobs in their wake,’ she said.
‘The reward for months of sacrifice cannot be a redundancy notice.’
The intervention came after the Prime Minister warned it would not be ‘healthy’ for the economy or workers for the furlough scheme to continue beyond its scheduled end date in October.
Rishi Sunak is due to deliver a ‘mini Budget’ next week, focusing on support for jobs.
But Ms Dodds said the Chancellor must give ‘back-to-work budget’.
She said the Government should consider imposing a wealth tax, which would target assets rather than income.
‘I think the Government does need to look at this area, I don’t think we’re in a fair situation,’ she said, arguing that the tax paid by the rich is a smaller part of their income proportionally than the poor.
‘And of course for the very, very best-off people quite a bit of their money coming in is derived from wealth.
‘I think we do need to have that new settlement and actually much of the opinion data has indicated that has a lot of support among the UK population as well.’
During the lockdown, Britons were told not to move house. This restriction has now been lifted, but the property market has remained sluggish.
Prices fell for the third month in a row in May as coronavirus stalled activity. However, the decline has been modest, with just a 0.2 per cent monthly downturn in values, according to mortgage giant the Halifax.
The fall took the average house price in Britain to £237,808 – 2.6 per cent higher than a year ago.
Figures from HM Revenue & Customs show that sales of homes in April fell to their lowest level since records began in 2005.
There were just 38,060 transactions completed during the month – less than half the number seen at the same point a year ago.
Mr Sunak will give a summer economic update to MPs on Wednesday afternoon, but they will have to wait until autumn for the next full-blown Budget when the stamp duty holiday is expected to be announced.
A huge expansion of apprenticeships is expected to be one of the biggest announcements this week, with all young people expected to be guaranteed the opportunity of one.
The target to get 50 per cent of young people into university is also expected to be abandoned.
To encourage Britons to go out and start spending this summer, Mr Sunak is expected to announce an immediate reduction in VAT for the hospitality industry.
Pubs, restaurants and hotels are likely to benefit from a six-month cut.
Ministers have long been under pressure to take action on stamp duty to help stimulate the market.
Last year when he was chancellor, Sajid Javid was understood to be considering a radical overhaul that would have made sellers pay the levy rather than buyers.
Those in favour of the change had argued that it would help buyers move up the property ladder as they would be paying the duty on the house they are selling rather than on the usually more expensive one they are buying.
However, it would negatively impact property owners looking to downsize.
The suggestion was eventually ruled out by Mr Javid.
It comes as Labour urged the Government to impose a ‘wealth tax’ on the ‘very best off people’ to pay for the coronavirus crisis if the UK economy fails to recover.
Shadow chancellor Anneliese Dodds said the ‘best way’ to pay for the cost of the outbreak would be through economic growth.
But she said if that fails to materialise then ‘those with the broadest shoulders should be bearing more of a contribution’.
She told the BBC’s Andrew Marr Show: ‘The best way to deal with the cost of this crisis is to ensure that our economy grows.
‘If we do that that will erode the value of the debt for as long as interest rates stay low.
‘I think it is really important we recognise that because that will provide the context for any decisions around taxation.
‘It is my view that if we do need to see an increased tax take we shouldn’t see it coming from those low and middle income people.
‘Instead we should have a focus on the very best off people. We have seen a rise in income and wealth inequality over recent years and I think those with the broadest shoulders should be bearing more of a contribution if that contribution is needed.
‘That would only be needed if we are not growing our way out of this crisis.’
Another 22 people have died of Covid-19 in the UK today in the lowest Sunday tally since lockdown began
Revealed: Covid bloodbath has put 200,000 out of work as chancellor Rishi Sunak is told to focus on ‘jobs, jobs, jobs’ in his mini-Budget this week
by JOHN STEVENS for the Daily Mail
Rishi Sunak faces a plea to keep Britain in work as the scale of the jobs bloodbath already under way is revealed today.
Almost 200,000 workers at household-name companies have been laid off since the start of lockdown, an analysis by the Daily Mail has found.
The Chancellor was told last night that his focus needs to be on ‘jobs, jobs, jobs’ in his mini-Budget on Wednesday
The Chancellor was told last night that his focus needs to be on ‘jobs, jobs, jobs’ in his mini-Budget on Wednesday.
Senior figures warned that the job losses so far will be just the ‘tip of the iceberg’ unless dramatic action is taken. Major layoffs have hit sectors such as retail, travel, hospitality and manufacturing, all of which have been shaken by the coronavirus pandemic.
Theatres, museums and galleries get £1.6billion lifeline with many shut until next year
Theatres, museums, galleries and other cultural ventures will get a £1.6billion bailout to stop them going under as a result of the coronavirus crisis.
Thousands of venues will be able to seek emergency grants and loans in what ministers say is the biggest ever one-off investment in UK arts.
With no live performances and more than 350,000 staff furloughed, the industry has warned that it will be devastated without cash aid.
Boris Johnson has promised to set out a timetable this week for when mass events can resume, but it is thought theatres, concerts and festivals may have to wait until 2021 to restart.
‘The UK’s cultural industry is the beating heart of this country,’ he said.
‘This money will help safeguard the sector for future generations, ensuring arts groups and venues across the UK can stay afloat and support their staff whilst their doors remain closed.’
Decisions on sharing out the bailout money will be made by bodies such as the British Film Institute, Arts Council England, the National Lottery Heritage Fund and Historic England.
Ed Sheeran, who wrote to the Government
Venues will be able to apply for £880million in grants and £270million in loans.
There will be £100million targeted at museums, galleries and heritage sites, £120million to restart infrastructure projects and extra money for Scotland, Wales and Northern Ireland.
Chancellor Rishi Sunak said: ‘Our world-renowned galleries, museums, heritage sites, music venues and independent cinemas are not only critical to keeping our economy thriving, employing more than 700,000 people, they’re the lifeblood of British culture. That’s why we’re giving them the vital cash they need.’
Last week 1,500 artists including Sir Paul McCartney, The Rolling Stones and Ed Sheeran wrote to the Government warning that the music industry faces a bleak future without more aid.
In just the past week alone, firms including Harrods, John Lewis, Cafe Rouge and Topshop-owner Arcadia have all wielded the axe, leaving more than 14,000 staff without a job. But data collated by the Daily Mail shows that 59 household-name companies have cut more than 195,000 roles since lockdown began in March.
Some of the biggest have been at Heathrow Airport, which has laid off 25,000 staff, British Airways, which is axing 12,000, and Rolls-Royce, which is cutting 9,000 jobs.
Thousands of smaller companies have also been reducing their staff. A total of 2.8million are now claiming Jobseeker’s Allowance or Universal Credit while searching for a job, according to official data.
Last night Lucy Powell, Labour’s business spokesman, said: ‘These job losses are devastating for the people involved and for the economy. We fear they are just the tip of the iceberg. Hospitality and high streets have been battered by this crisis, with many businesses struggling to survive. We need a back-to-work Budget with a laser-like focus on jobs, jobs, jobs.’
Labour is calling for a £1.7billion hospitality and high streets ‘fightback fund’ to help protect jobs.
Former Conservative chancellor Lord Lamont called for employers to be given a holiday on National Insurance payments, as he warned that jobs must be ‘absolutely the key priority’ for Mr Sunak.
The Tory grandee, who held the post during the 1992 Black Wednesday crisis, said: ‘He has acted boldly and quickly, but the difficult part is yet to come.’
Lord Lamont, who was speaking on the Blue Collar Conversations podcast, said: ‘I would perhaps have a holiday for employers’ National Insurance for a period of time. If you cut the cost of employing people that will be the best way to retain jobs. Firms are going out of business not through any fault of their own.’
Meanwhile, a group of former economic advisers to five Tory prime ministers or chancellors suggested that while the focus should be on ‘jobs jobs jobs’, debt must also be falling by 2024.
They set out a plan for the UK’s recovery from coronavirus that includes a national debt restructuring agency and an unprecedented skills and jobs package.
The report, written by Mats Persson, Adam Memon, Raoul Ruparel, Tim Pitt, Will Tanner and Neil O’Brien for think-tank Onward, also calls for £30billion to be invested in struggling firms.
The pace of cuts is picking up as the Government’s furlough scheme, which has been used by 1.1million employers to protect 9.3million workers, draws to a close.
Companies have already used the scheme to pay £25.5billion of their employees’ wages. Thousands who have been let go had originally been furloughed, leading to fears that millions more furloughed workers will never return to their job as Mr Sunak gradually withdraws the wage support.
A survey today suggests that 44 per cent of businesses participating in the furlough scheme believe they will have to let at least some of their staff go when it ends.
The poll of 500 companies, conducted by Opinium on behalf of the think-tank Bright Blue, found that 65 per cent medium sized firms with between 50 and 249 workers, said they expect to make redundancies.
In just the past week alone, firms including Harrods, John Lewis, Cafe Rouge and Topshop-owner Arcadia have all wielded the axe
A group of 120 industry leaders in the hospitality sector have written to Boris Johnson, calling for VAT to be cut temporarily from 20 per cent to 5 per cent to encourage consumers to spend.
The group, coordinated by industry body UK Hospitality, also wants the Government to defer July tax payments for businesses such as hotels and restaurants, hand out targeted grants, and extend the business rates holiday.
The Office for Budget Responsibility, the Government’s watchdog, predicted in April that around 3.4million people, or one in ten of the working age population, would be unemployed by the end of June.
Companies will get a £1,000 cash bonus for every young person they hire as Rishi Sunak prepares to unveil a £111million boost for the traineeship scheme in ‘mini-budget’
by JOHN STEVENS for the Daily Mail
Companies will get a £1,000 cash bonus for every young person they hire as trainees, Rishi Sunak will announce this week.
In his ‘mini budget’ on Wednesday, the Chancellor will unveil a £111million boost for the traineeship scheme.
As part of the plans, employers will be given £1,000 for every young person aged between 16 and 24 that they hire, up to a maximum of ten trainees, or £10,000.
It is the first time firms will be paid direct government subsidies for hiring youngsters.
Mr Sunak told The Daily Telegraph: ‘Young people are on the front line at risk of unemployment, so we’re backing them and the companies that they can learn from.
Chancellor of the Exchequer Rishi Sunak said: ‘Young people are on the front line at risk of unemployment, so we’re backing them and the companies that they can learn from’ (pictured outside Downing Street)
‘We know traineeships work so we’re investing in their skills and our collective future.’
As part of a traineeship initiative, which lasts from six weeks to six months, young people receive maths, English and CV writing training as well as work placements.
The extra funding will triple the number of places on the programme that is designed to give those aged between 16 and 24 the skills to secure a job.
A Treasury spokesman said: ‘The Government are making available three times more funding to providers this year to pay for tripling the number of trainees, and also increasing the funding providers receive for training.
‘Businesses will also get a £1,000 bonus payment from the Government for every trainee they offer a work experience placement to.
‘Employers who are new to providing trainees with work experience, or growing their existing offer, will also be eligible for the payment.
It is the first time firms will be paid direct government subsidies for hiring youngsters (stock image)
‘Evidence shows three-quarters of 18 to 24-year-olds who complete traineeships move on to employment or further study within 12 months.’
The scheme is also being extended to A-Level pupils and will be in place in England from September 2020.
The Government said it will also provide £21 million to the devolved administrations in Scotland, Wales and Northern Ireland for similar initiatives.
Also, work academies are to get a £17 million investment.
Funding is being provided for more than 30,000 extra places at sector-based work academies, the Treasury said.