He announced an extension to the furlough scheme, new high street grants, and extra support for the self-employed, among other measures to support the economy as the UK seeks to emerge from the Covid crisis in the spring.

This year’s Budget is the first since the onset of the coronavirus crisis last March, which prompted Sunak to announce wide-ranging economic support measures – many of which remain in place today – just a few days after delivering the government’s annual fiscal plan on 11 March.

New figures from the Office for National Statistics have since revealed travel and tourism has been the sector hardest hit by the effects of the Covid crisis, with international travel demand – in particular – hugely depressed owing to travel restrictions.

Abta has urged the government to address its "blind spot" to travel which it says has meant "large swathes of the travel industry – including tour operators and homeworkers – have been excluded from support".

It is calling for tailored support for travel, along with an extension to the furlough scheme, high street support grants, and further business rates relief.

TTG will be bringing you live updates below from 12.30pm on the chancellor’s key Budget announcements, as well as further reaction throughout the afternoon via ttgmedia.com.

Economic damage ’acute’

"A year ago in my first Budget, I announced our first response to coronavirus. What was thought to be a temporary disruption has fundamentally altered our lives. Businesses have been ordered to close, thousands are in hospital," says Sunak by way of setting the scene for his statement.

"Much has changed, but I said I would do whatever it takes, and I will. We have announced £280 billion in support. But despite this unprecedented support, the damage done to the economy is acute; 700,000 [people] have lost their jobs since last March, and the economy has shrunk by 10% – the largest in 300 years.

"It is going to take a long time to recover from this extraordinary economy situation. But we will recover. This Budget meets the moment with a three-part plan to protect jobs and livelihoods."

Plan to protect jobs

Sunak starts by outlining his plan to protect jobs.

• Furlough extended to end of September, on the same terms as we have come to know.
• Businesses will be asked for a 10% contribution in July, rising to 20% in August and September.
• Support for self-employed will be extended to September through two new grants.
• Fourth grant will cover period from February to April, and a fifth "and final" grant covering the period from May onwards.
• Fourth grant will cover three months of support at 80% of average trading profits. Fifth grant will work on the same terms, with the system open for claims from late-July.

Targeted self-employed support

There will be further targeted support "for those most affected by the pandemic":

• People whose turnover has fallen by 30% or more will continue to receive the full 80% grant.
• People whose turnover has fallen by less than 30% will receive a 30% grant.
• Sunak promises "major improvement in access" to self-employed support scheme, including opening to newly self-employed who could not apply last year. Move means 600,000 more people, many of whom became self-employed last year, will be able to claim the fourth and fifth grants.
• Sunak says over course of crisis, £33 billion will have been spent on supporting the self-employed.
  
  

New £6,000 ’Restart Grant’

Chancellor says he recognises some businesses will need loans to see them through when the Coronavirus Business Interruption Loan Scheme (CBILS) comes to an end in March.

"This Budget will also protect businesses," says Sunak. New measures include:

• New "Restart Grant" in April "to help businesses reopen and get going again".
• Non-essential retail businesses will qualify for grants of up to £6,000 per premises.
• Direct total cash support to businesses up to £25 billion, says chancellor.
• New "Recovery Loan Scheme" will continue from where bounce back loan and CBILS schemes left off.
• Businesses of any size can apply for loans from between £25,000 to £10 million through to the end of the year, with the government providing an 80% guarantee to lenders.
  
  

Business rates holiday extended

Sunak says the ongoing business rates holiday will continue.

• Government will continue with a 100% business rates holiday for the first three months of the financial year through to the end of June.
• For the remaining nine months of the year, business rates will be discounted by two-thirds up to a value of £2 million for closed businesses and a lower cap for those that have been able to open.
  
  

Tourism among sectors ’hardest hit’

"One of the hardest hit sectors has been hospitality and tourism," says Sunak. "150,000 businesses employing more than 2.4 million people need our support."

• Sunak says to support those jobs, he can confirm the 5% reduced rate of VAT will be extended for six months through to 30 September.
• 20% rate of VAT won’t be immediately reintroduced in October, interim rate of 12.5% will be introduced for another six months, with the rate returning to normal in April 2022.
• VAT will be cut over the next 12 months by nearly £5 billion says Sunak.
  
  

’Huge challenges’ ahead for public finances

Sunak says government’s total fiscal support over the past year and next will run to £407 billion.

"Coronavirus has caused one of the largest, most comprehensive and sustained economic shocks this country has ever faced," says Sunak.

The damage has, and will continue to, create huge challenges for public finances, says the chancellor.

Borrowing is at its highest level since the Second World War and borrowing next year (2021/22) will be rivalled only by 2020/21, Sunak tells the Commons.

Levels of borrowing are not expected to fall to pre-Covid levels for the best part of another five years.

How do we fix public finances?

We need to begin "right now" with the work of fixing our public finances, says Sunak, announcing two measures to begin this work.

• Sunak says more will be asked of people and businesses that can afford to contribute to protect those who can’t. Income tax, National Insurance and VAT rates to remain at current levels.
• After an increase for the 2021/22 financial year, personal tax thresholds will be frozen until April 2026. Higher rate threshold will also increase and then be frozen over the same period.
• "No one’s take home pay will be less than it is now as a result of this policy," says Sunak.
  
  

’Businesses must contribute to recovery’

Businesses will be provided in excess of £100 billion in support so it is "only fair and necessary to ask them to contribute to our recovery", says the chancellor.

• In April 2023, rate of corporation tax paid on company profits will increase to 25%. This will still be lowest rate in the G7, says Sunak.
• Chancellor says increase will come "well after the point the OBR expects the economy to have recovered".
• Small businesses with profits of £50,000 or less will benefit from a new small profits rate maintained at the current rate (of corporation tax) of 19%. Chancellor says the move means around 1.4 million businesses will therefore be completely unaffected by the increase in corporation tax.
• A taper for businesses with profits above £50,000 will be introduced so only businesses with profits in excess of £250,000 will be taxed at the full 25% rate.
• Tax treatment of losses for the next two years to be "significantly" more generous by allowing businesses to carry back losses of up to £2 million for three years, which the chancellor said would offer a "significant cash flow benefit".
  
  

’We need an investment-led recovery’

Chancellor says country must do "even more" to encourage businesses to invest immediately "to create jobs, lift growth, spur innovation and drive productivity".

"Right now, while many businesses are struggling, others have been able to build up significant cash reserves. We need to unlock that investment," says Sunak. "We need an investment-led recovery."

• Chancellor announces new "super deduction".
• For next two years, when companies invest, they can reduce tax bill with "super deduction" by 130% of cost.
• Chancellor says it will be worth £25 billion in the two years it is in place and will be "the biggest tax cut in modern British history".