Government to pay wages, pause VAT and delay tax payments in 'unprecedented' support package

Grants to cover employees' wages are among several major coronavirus support announcements unveiled by the chancellor which he described as "unprecedented in the history of the British economic state". Dan Martin reports.

Prime minister Boris Johnson opened the government's daily briefing by announcing that all pubs, cafes, bars, clubs, restaurants, theatres, cinemas, gyms, and leisure centres must close tonight (Friday) in the latest move to stop the spread of COVID-99.

Businesses will still be able to offer takeaway services.

Johnson said the measures will be "strictly" enforced and licensing arrangements mean it will be "relatively simple" to do so.

The government has already announced business rates relief and grants for retail, leisure and hospitality businesses.

Coronavirus support for employers and employees

Chancellor Rushi Sunak joined the prime minister at the briefing to unveil a new package of support that he called "one of the most comprehensive in the world".

A new job retention scheme will be set up through which employers of all sizes can apply for grants to cover up to 80% of employees' monthly wages to a maximum of £2,500. Payments are backdated to 1 March which means staff who have been made redundant since then will still be covered.

The scheme will open before the end of April for at least three months. There is no limit on the amount of funding available.

"Let me speak directly to businesses: I know it's incredibly difficult out there - we in government are doing everything we can to support you," Sunak said.

"The government is doing its best to stand behind you and I'm asking you to do your best to stand behind our workers."

The chancellor also said VAT payments for all businesses are deferred until 30 June and loans through the Coronavirus Business Interruption Loan Scheme, which launches next Monday, will be interest free for 12 months. It was previously six months.

Coronavirus help for the self-employed

The chancellor said self-employed people will be able to get full Universal Credit benefits at a rate equivalent to statutory sick pay (£94.25 a week), while self-assessment tax payments will be deferred until January 2021.