Skip to content
Search

Latest Stories

UK to extend virus support, may raise tax in budget

BRITAIN is expected to keep vast emergency financial support propping up the UK's virus-battered economy when unveiling its annual budget Wednesday (3), but could also raise tax to fight surging debt.

"The key thing is right now to keep supporting the economy... but also level with people," finance minister Rishi Sunak said Sunday (28), as Britain from next week begins to exit its third Covid lockdown.


Britain is the worst-hit country in Europe with more than 120,000 Covid deaths and four million cases but its economic recovery hopes have been boosted by its vaccination of millions of adults.

Reports suggest that Chancellor of the Exchequer Sunak will pump out extra billions of pounds to help save jobs and businesses. But he is expected also to increase corporation tax, or a levy on company profits, from a UK record-low 19 percent while sticking to the Conservative government's pre-pandemic pledge not to increase income tax or value added tax (VAT).

"An increase in corporation tax is likely to be, intentionally or not, the flagship measure," Barclays said in a client note.

"Put in perspective, corporation tax is not a main lever in terms of revenues - around 10 percent of tax receipts - but probably the path of least resistance as the government explores ways to fix its revenue shortfall."

Prime minister Boris Johnson's government has in fact cut VAT on food, accommodation and attractions during the coronavirus outbreak. It has also lifted the threshold at which stamp duty is due on home purchases, helping property buyers and the construction sector. Both these temporary measures could be extended in the budget, according to economists.

A cross-panel of MPs, in a report Monday (1), said it was too soon to raise taxes and that corporation tax should eventually be raised only moderately, while being combined with continued support measures for businesses. "It is clear that a very significant increase in the corporation tax rate would be counterproductive," the Treasury Committee said.

Committee chair and Tory MP Mel Stride noted that with Britain's "public finances on an unsustainable long-term trajectory, our clear message is that Budget 2021 is not the time for tax rises or fiscal consolidation, which could undermine the economic recovery.

"But we will probably need to see significant fiscal measures, including revenue raising, in the future," he added.

Soaring debt

Since April 2020, or soon after the UK's first virus lockdown, the government's net borrowing has ballooned by £271 billion ($378 billion, 314 billion euros), according to recent data.

A big chunk of the outlay has been to keep millions of private-sector workers in jobs via the government's furlough scheme, with the bulk of wages to be paid until the end of April. Again this could be extended.

Analysts argue that Britain must use the budget to both extend coronavirus financial support measures and tackle inequalities exacerbated by Covid.

In a joint report, the Institute for Fiscal Studies and Citi bank noted that lower-income households had not been able to save as much cash as richer counterparts, sparking greater inequality in society during the crisis.

They added that Sunak must also help the economy -- which has shrunk by around 10 percent owing to the pandemic -- adjust to the "triple challenge" of Brexit, Covid and the green energy transition.

The budget is expected to confirm the launch of an Infrastructure Bank with £12 billion in capital and £10 billion in government guarantees. The bank is set to finance private sector projects in the green economy, focusing on areas such as carbon capture and renewable energy.

(AFP)

More For You

Kareena Kapoor

Striking appearance at the Vivienne Westwood show

Instagram/ kareenakapoorkhan

Kareena Kapoor dazzles in red at Vivienne Westwood show in Mumbai

Bollywood star Kareena Kapoor made a striking appearance at the Vivienne Westwood show in Mumbai on Tuesday evening, turning heads in a glamorous red ensemble. The event, held at the iconic Gateway of India, was a celebration of India’s rich textile heritage and featured an exclusive showcase of Vivienne Westwood’s Spring-Summer 2025 collection.

A show-stopping look

Kareena Kapoor, known for her impeccable fashion sense, was the cynosure of all eyes as she arrived in a stunning red gown featuring a thigh-high slit, corset bodice, and off-shoulder sleeves. Her outfit exuded elegance and sophistication, complemented by her gold-hued heels, which added a touch of glamour to her look.

Keep ReadingShow less
Timeless luxury: The 5 most expensive Rolex watches of 2025

Rolex continues to captivate the world with its dedication to perfection

Getty

Timeless luxury: The 5 most expensive Rolex watches of 2025

Rolex, a name synonymous with luxury, craftsmanship, and timeless sophistication, has once again redefined the boundaries of opulence in 2025. As one of the most iconic watchmakers in history, Rolex continues to create masterpieces that epitomise both innovation and style. Below, we explore some of the most expensive and desirable Rolex watches of the year, each a testament to unparalleled artistry and technical precision.

1. Rolex GMT-Master II Pepsi Meteorite (£49,000)

Rolex GMT-Master II Rolex

Keep ReadingShow less
Sukhvinder Kaur: Finding light in the tunnel of loneliness

Sukhvinder Kaur: Finding light in the tunnel of loneliness

LONELINESS can affect people of all ages and backgrounds in different ways. Sukhvinder Kaur was deeply impacted by social isolation after her marriage broke down, leaving her alone with two young children.

Despite a happy upbringing, a supportive family, and a strong community network, she began experiencing uncomfortable thoughts that didn’t resonate with her, leading to increased isolation.

Keep ReadingShow less
Ayurveda: The ancient science of balance and well-being

Ayurveda was given to mankind at the time of satyug, when the diseases though existed had not yet manifested in the physical world.

iStock

Ayurveda: The ancient science of balance and well-being

Ashwini Gurujii

Ayurveda finds it origin in one of the four Vedas, the Atharvaveda. Brahma ji propounded the science of Ayurveda and passed it on to Daksh Prajapati, who gave it to Ashwini Kumars, the physicians of devas, and they gave it to Indra.

Ayurveda was given to mankind at the time of satyug, when the diseases though existed had not yet manifested in the physical world. The level of existence was so pure and selfless that diseases were unable to manifest then. The rishis of satyug realized that in the times to come, the thoughts of people are going to become so polluted that diseases will find the required environment to manifest and then the need of Ayurveda would arise, so Rishi Bharadwaj went up to Indra Dev and asked for this divine science.

Keep ReadingShow less
Why helping ageing parents is precious

As our parents age, we embrace new roles in their lives with compassion and care.

Why helping ageing parents is precious

AS OUR parents’ health begins to deteriorate, one of the hardest things in life is watching them age. Some can no longer walk for more than 10 minutes, and their memory isn’t what it used to be. There are also hidden complications associated with ageing.

I grew up in a working-class family. My dad was named Simba when he lived back in Zanzibar, Africa. He swam in the open ocean and ran for miles. The joinery skills he learned from his father have been passed down to my brother and me. My mum worked long hours sewing and in factories to provide for us, ensuring we had everything we needed. She also taught me never to rely on anyone for anything, which has shaped me into the strong, independent woman I am today.

Keep ReadingShow less